Does your company operate a permanent establishment in the Netherlands, and have you recently paid dividend on the shares held by your shareholders?
Under Dutch tax law, companies are required to withhold dividend tax on most of the dividend payments they make. The dividend you reserve must then be declared to the Dutch Tax and Customs Administration by way of a dividend tax return. There are, however, certain laws that exempt shareholders from dividend tax in specific situations.
The specialists at Koppel Services will help you determine the proper course of action in your situation. We can also ensure that your dividend tax return is compiled and submitted correctly.
In the Netherlands, dividend tax is a separate tax that is levied in alongside other corporate taxes. Whenever an organization pays dividends to its shareholders, it is legally obligated to withhold a 15% dividend tax and set this aside for the Dutch Tax and Customs Administration. Furthermore, individual shareholders without a substantial interest in the company in the Netherlands pay a 1,2% tax over the value of their shares as part of a flat tax on savings and investments. Individual shareholders that do hold a substantial interest pay up to 25% dividend tax.
In practice, this means that shareholders who receive dividend payments no longer owe taxes over said payments, since your company has already withheld dividend tax for them. Before dividend can be paid, your company is required by law to pass an assets and liquidity test. It is worth noting that the Netherlands does not require companies to withhold taxes over royalties and interest.
Are you planning to pay dividends to your shareholders? Depending on the circumstances, some or all of your shareholders may be exempt from dividend tax. The tax specialists at Koppel Services will be happy to explain how your company can use this participation exemption to its advantage. Our team can also help you compile your dividend tax returns and facilitate their submission to the Dutch Tax and Customs Administration.
Do you have any questions about dividend tax in the Netherlands, and are you looking for a tax advisor who can help you address them? Koppel Services has years of relevant experience and will gladly assist you in any tax-related matter.