It can be said that the Netherlands is still a good choice for foreign investment considering the Dutch tax advantage. In this blog, when you want to build a Dutch BV company, we will mention some tax benefits.
Tax incentives Netherlands
In this blog, we will learn about the following tax benefits in the Netherlands:
The 30% ruling is a tax break for Dutch high-tech immigrants. This means that the Dutch tax on the total amount of wages is reduced to 70%, which means that 30% of the wages are tax-free. This tax benefit, also known as the “30% reimbursement ruling” or “30% facility”, applies to foreign employees who work in the Netherlands and meet the requirements.
The Netherlands also provides access to the Dutch Bilateral Investment Treaty (BITs) network, which includes a number of jurisdictions. Bilateral investment agreements can be used to ensure that investors in certain jurisdictions receive the same treatment as domestic investors or investors from third countries. In addition, BITs can provide protection from expropriation. Under most Dutch bilateral investment agreements, the use of Dutch companies in corporate structures can prevent any foreign government intervention, where dispute resolution provisions require international arbitration rather than having to pass the domestic court system.
The Dutch participation in exemptions is the main attraction of the company. The tool allows dividends and capital gains to be received from subsidiaries. duty free. This makes the Netherlands attractive for expanding into Europe and the rest of the world. Would you like to know more about the criteria that must be met to obtain this full exemption? Give us a call!
Other tax benefits for the company in the Netherlands include financing (including mixed debt) and no withholding tax on interest, services and royalties. The Netherlands also provides an innovative framework system under which profits of qualifying intangible assets are taxed at an effective rate of 5%. In addition, the profits of Dutch holding entities are usually subject to a 25% corporate income tax. The Netherlands does not appear on most blacklists issued for anti-abuse purposes in different jurisdictions.
If certain conditions are met, the Dutch subsidiary of the Dutch company can form a fiscal unity. Would you like to know more about these conditions?
The advantage of achieving fiscal harmonization is that for Dutch tax purposes, entities are taxed as if they were a taxpayer. Corporate restructuring can be carried out on a tax-deferred basis; this includes mergers, spin-offs, stock exchange shares and stock exchange assets. Holland also offers reinvestment reserves. This means that taxes on the proceeds of the sale or conversion of tangible or intangible commercial property are not considered passive investments, but can be postponed if the taxpayer intends to repair the property or reinvest the proceeds.
Dutch tax authority
Last but not least, the Dutch tax authorities are open-minded. Contrary to other countries, the Netherlands offers the possibility of pre-discussing tax status with the Dutch tax authorities. These discussions can be formally determined through an agreement (or ruling) with the Dutch tax authorities.
More information about tax incentives for Dutch companies
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