Netherlands: Tax developments concerning financial institutions (December 2020)

Netherlands: Tax developments, financial institutions

Recent tax developments that may affect financial institutions include the following items.

  • The Lower House of Parliament passed the 2021 tax plan package and a bill on the liquidation and cessation loss schemes limitation law.
  • A private member’s bill on the “Conditional Final Settlement of Dividend Withholding Tax Emergency Act” (submitted in July 2020) was amended for a second time.
  • The government presented a relief and recovery package for businesses and workers as a follow-up to the first two emergency packages (NOW 1, NOW 2, and NOW 3).
  • A Romanian court referred an issue to the Court of Justice of the European Union (CJEU) regarding the concept of fixed establishment for value added tax (VAT) purposes. Read TaxNewsFlash
  • The CJEU rendered a judgment holding that value added tax (VAT) may be deducted on purchased services in the event of a proposed but unrealized share acquisition. Read TaxNewsFlash
  • The Dutch Supreme Court (Hoge Raad) issued a decision in a case concerning the compatibility of the Dutch withholding tax on dividends distributed to non-resident investment funds with EU law. Read TaxNewsFlash
  • The announced 2021 tax plan may have significant implications for financials and especially income tax position.
  • Financial institutions may need to take steps before 1 January 2021 in order for them to state in their corporate income tax returns for 2021 that all the substance requirements have been met.
  • Beginning 1 January 2021, taxpayers and intermediaries are required to report certain arrangements under DAC6 (also known as the mandatory disclosure regime (MDR)) for tax arrangements that were entered into since 25 June 2018. 

Read a December 2020 report prepared by the KPMG member firm in the Netherlands

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