NETHERLANDS Trends and Developments Contributed by: Frans Sonneveldt and Mike Vrijmoed, Forvis Mazars NV
• a minimum age of 21 has been introduced for both the income tax facility and the gift and inheritance tax exemption. • the continuation period for the inheritance tax exemption has been reduced from five to three years from 1 January 2025. • from 1 January 2026: (a) restructurings during the continuation period should be less restricted; and (b) it will be more difficult to meet the criteria with different classes of shares. These adjustments are intended to better align the schemes with the practice of business succession. They offer more flexibility for families in planning busi - ness transfers, but require a careful approach to make the most of the facilities. Also, misuse of this facility will be minimised as much as possible by the legisla - tor. Real Estate: A Changing Landscape for Investors The real estate sector is facing significant changes that affect both investors and tenants: • the transfer tax has risen to 10.4% (this general rate will be lowered to 8% from 1 January 2026 on), with a reduced rate of 2% for primary resi - dences; and • new tenancy laws introduce restrictions on rental contracts and regulate rent increases more strin - gently. These changes have a significant impact on real estate investments and may influence the strategy of high-net-worth individuals in managing their real estate portfolio. Corporate Income Tax and Dividend Withholding Tax For business owners and shareholders, there are sev- eral essential developments in the area of corporate income tax and dividend tax: The corporate income tax rates for 2025 are: • 19% on the first EUR200,000 of profit; and • 25.8% on the excess.
A noteworthy change in Dutch tax law is the aboli - tion of the open limited partnership ( open commandi- taire vennootschap or CV) status, effective 1 January 2025. This modification significantly impacted numer - ous investment structures. Open CVs have lost their corporate tax status and become transparent for tax purposes. The open CV structure has been widely utilised in privacy-oriented arrangements. Similar changes also apply to open mutual family funds ( open fonds voor gemene rekening ) and to foreign partnerships. The dividend tax rate in the Netherlands remains at 15%, with a general full exemption for intra-group dividends. However, it is crucial to be aware of anti- abuse measures, particularly relevant for foreign hold - ing companies with stakes in Dutch entities. These measures can pose significant challenges, especially for privately held foreign holdings that struggle to meet the requisite substance requirements. The substance criteria include, among others: • a minimum of EUR100,000 in annual payroll costs, which must be directly related to the activities involving participation in the Dutch company; and • the holding company must have an appropriate office space at its disposal. These requirements are designed to ensure that the holding company has a genuine economic presence in its jurisdiction, rather than existing solely for tax purposes. Failure to meet these criteria can result in the denial of tax benefits and potential additional tax liabilities. UBO Register and DAC6/7/8: Increasing Transparency Although not directly related to taxes, the develop - ments around the UBO (Ultimate Beneficial Owner) register and the European directives for automatic exchange of information (DAC6/7/8) have an impact on the tax planning and privacy of wealthy individuals: • the UBO register requires that ultimate beneficial owners of Dutch legal entities and other entities be registered;
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