Corporate Tax in the Netherlands
- Tax Base For Resident and Foreign Companies
- Resident companies are subject to taxation on their worldwide income, and non-resident companies are subject to corporate income tax on certain Dutch-source income.
|Corporate income tax rate||The applicable tax rates and brackets are: up to EUR 40,000 - 20%, EUR 40,000 to EUR 200,000 - 23.5% and income exceeding EUR 200,000 - 25.5%.|
- Tax Rate For Foreign Companies
- There are no special tax rates for foreign companies.
- Capital Gains Taxation
- There is no specific tax rate for capital gains but gains and losses are included in the company’s general taxable income.Capital gains are therefore taxed at 25.5% (normal corporate income tax). The basis for calculating a capital gain or loss is the difference between the book value of an asset (original cost minus depreciation) and the amount for which the asset is sold (which under circumstances can be replaced by the fair market value)..
- Main Allowable Deductions and Tax Credit
Costs incurred in setting up a business, reserves earmarked for certain types of future spending and book profits, rents, royalties and interest payments on corporate debt, remuneration paid to members of the managing and supervisory boards, many types of taxes, bad debts, capital losses, pension plan contributions, commissions, bonuses paid to employees through an internal profit-sharing plan, gifts to contributions to religious, social, charitable and other institutions and mixed expenses.
Foreign tax credits on dividend, interest and royalty income are limited to taxes withheld from income items originating either in a country that has concluded a tax treaty with the Netherlands or certain developing countries listed by the State Secretary of Finance. However, a Dutch company may not credit any foreign withholding tax levied on dividends received from foreign subsidiaries to which the participation exemption applies.For additional information.
- Other Corporate Taxes
- Transfer tax is levied on the acquisition of property in the Netherlands at a rate of 6% of the market value of the property. Insurance tax at a rate of 7% applies on insurance premiums, but life, accident, medical, invalidity, disability, unemployment and transport insurance are exempt.
Motor vehicle tax is paid on all vehicle ownership, with the amount depending on the type and weight of the vehicle and, for private cars, the type of fuel.
In the overseas municipalities of Bonaire, St. Eustatius and Saba (also known as the BES islands), there is no corporate income tax on revenue or profits. Instead, two alternative taxes have been introduced: a tax on real estate (property tax) and a withholding tax on revenue distributions.
Country Comparison For Corporate Taxation
|Number of Payments of Taxes per Year||9.0||14.2||11.0||16.0|
|Time Taken For Administrative Formalities (Hours)||134.0||199.3||187.0||215.0|
|Total Share of Taxes (% of Profit)||40.5||43.0||46.8||48.2|
Source: Doing Business
Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action. **** The Greater the Index, the Higher the Level of Investor Protection.
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