NETHERLANDS LAW AND PRACTICE Contributed by: Friederike Henke, Ingrid Cools, Philip ter Burg, IJsbrand Uljée, Suzan van de Kam and Epke Spijkerman, BUREN
is one year. Profits of up to EUR1 million can be fully deducted under the application of the loss carry forward and backward facility. For profits exceeding EUR1 million, only 50% of the profit can be reduced under these facilities. Minimum Profit Tax In line with EU regulation, the Netherlands has introduced a Minimum Profit Tax law: Wet Mini- mumbelasting 2024. The minimum tax act 2024 requires large multinational enterprises with an annual turnover exceeding EUR750 million to be subject to (at least) 15% minimum corporate income tax due to the so-called OECD Pillar 2 project. Dividend Withholding Tax Shareholders of Dutch tax-resident companies are generally subject to 15% Dutch dividend withholding tax in respect of dividends (and oth - er payments treated as dividends) paid by Dutch tax-resident companies (or companies deemed to be tax residents). In principle, distributing companies should withhold and pay any Dutch dividend withholding tax due. An exemption applies to dividends distributed to corporate shareholders owning a share interest of at least 5% in the relevant distributing com - pany if, in short, the corporate shareholder is a tax resident of the EU or a Dutch tax treaty jurisdiction, and is the beneficial owner of the dividend, provided it is not a hybrid transaction and certain other anti-abuse tests are met. Application of the extensive Dutch tax treaty net - work may result in a reduction or refund of Dutch dividend withholding tax. Conditional Withholding Tax The Netherlands does not currently levy with - holding tax on interest and royalty payments,
with the exception of a specific levy in intragroup abusive situations. In 2025, a conditional withholding tax at a rate of 25.8% is due on intra-group dividend, inter - est and royalty payments by Dutch resident companies to related entities residing in juris - dictions that are either on the blacklist issued by the Dutch Ministry of Finance (including low tax jurisdictions (less than 9%) and jurisdictions that are on the EU blacklist of non-co-operative jurisdictions) or in abusive situations. VAT The Netherlands levies Value Added Tax (VAT) on the supply of goods and services as part of the domestic implementation of the EU VAT Direc - tive (Directive 2006/112/EC). The current Dutch VAT system, therefore, is comparable to the VAT systems of other EU member states, although the Netherlands uses certain optional measures to facilitate trading. Under Dutch VAT law, in principle any person or entity can qualify as an “entrepreneur” (taxable person) if they act independently and perform (preparatory acts to) economic activities on a continuing basis, whatever the purpose or result of those activities. Entrepreneurs acting as such are, in principle, required to file VAT returns and are entitled to a refund of (input) VAT charged, provided they are engaged in VAT taxable trans - actions within the territory of a member state of the European Union. In the Netherlands, the following VAT rates apply to supplies of goods and services in 2025: • general rate: 21%; • reduced rate: 9%; and • zero rate (0%).
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