NETHERLANDS Law and Practice Contributed by: Nathalie Idsinga and Mignon de Wilde, Arcagna
For primary residences, the RETT rate is 2% and a one-time RETT exemption is available to individuals aged 18 to 35, provided the property’s value does not exceed EUR525,000. If gift tax is due in connection with the acquisition of real property, the RETT may be (partially) offset against the gift tax. Real estate acquired via inherit - ance is exempt from RETT. Capital Gains Tax The Netherlands does not levy a separate capital gains tax. Dutch VAT Dutch VAT is charged on supplies of goods and ser - vices in the Netherlands. The basic rate is 21% (2025). A reduced rate of 9% (in 2025) applies to other goods and services (eg, food, arts and books) and services (eg, passenger transport, theatre performances). In addition, certain goods and services are subject to 0% VAT or are VAT exempt. 1.2 Exemptions The amount of the applicable exemption depends on the relationship between the deceased or donor and the beneficiary. For inheritance tax purposes, the exemptions for 2025 are: • partners – EUR804,698 (from which half the cash value of pension rights derived by the partner upon the deceased’s death is deducted; the minimum exemption is EUR207,886); • children whose living expenses were mainly paid by the deceased and who are not expected to earn at least half the income of a healthy person within three years – EUR76,453; • other children and grandchildren – EUR25,490; • parents – EUR60,359; and • other beneficiaries – EUR2,690. For gift tax, the annual exemptions for 2025 are: • children – EUR6,713; and • other beneficiaries – EUR2,690.
For gifts to children between 18 and 40 years old, the annual exemption can be increased one time to EUR32,195 or EUR67,064 if the gift is used for educa - tion and certain conditions are met. The Inheritance Tax Act 1956 also provides a separate tax facility for business assets and substantial share - holdings that qualify as business assets: the business succession facility ( bedrijfsopvolgingsfaciliteit , or BOR – see 4.2 Succession Planning ). 1.3 Income Tax Planning Upon immigration, a taxpayer holding a substantial interest may, under certain conditions, be eligible for a step-up in the tax basis of their shares to the fair market value at the time of immigration. However, a step-up may be denied or only partially granted if the taxpayer has previously resided in the Netherlands, or if the taxpayer has previously been classified as a non-resident taxpayer with respect to the substantial interest. Other (pre-immigration) tax planning includes the allo - cation of investment assets in Box 2 versus Box 3, and estate planning by making gifts prior to becoming a Dutch tax resident or, while being a Dutch tax resident, by making annual gifts to children. 1.4 Taxation of Real Estate Owned by Non- Residents Non-resident individuals who own Dutch real property directly in private are subject to personal income tax in Box 3 (see 1.1 Tax Regimes under Box 3), subject to the application of a treaty for the avoidance of double taxation. 1.5 Stability of Tax Laws The Dutch government will present its Tax Plan on Budget Day on 16 September 2025. Certain tax revi - sions have already been announced during Budget Day last year, or the Spring Note that was published earlier this year. Noteworthy changes that have been proposed are listed below. These changes are expected to enter into effect in 2026, unless noted otherwise.
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