You must consider a range of issues, such as:
On the basis of the legislation of the new country of residence, you will probably be taxed there on your entire (global) income. In addition, the Netherlands will continue to tax you as a foreign taxpayer on your Dutch income, for example for Dutch property or profit from your Dutch company. To avoid double taxation, your new country of residence will typically grant you exemption from double taxation on your foreign (Dutch) income.
Emigration could have a beneficial impact on your tax position, but also the reverse. It depends on the laws of the new country of residence. Emigration frequently offers tax planning opportunities, as tax rates and tax bases of countries differ, for example in respect of capital gains on qualifying shareholdings. Pension problems and qualifying interest are often relevant topics in emigration.
Provisional assessment of qualifying interest
Are you as a qualifying interest holder with a shareholding of at least 5% in a company emigrating from the Netherlands to another country? Then this will be seen as a fictitious sale of your qualifying interest. This means that you must pay 25% income tax on the difference between the value of the shares at the time of emigration and the purchase price.
However, you do not have to settle it directly. On request, a provisional assessment of income tax will be determined. This means that you will be granted deferred payment for a period of (approximately) 10 years. During this 10 year period you may not dispose of the shares, pay back any capital or disburse profit reserves for 90% or more on pain of recovery of the provisional assessment. After this 10-year period the provisional assessment will be waived. Emigration offers opportunities to dispose of your equity interest, after the 10-year period, depending on the tax laws of your new country of residence, free of charge or at low charge.
Effective management of your BV
Emigration of a director/major shareholder may - depending on the facts and circumstances - lead to a relocation of the effective management of the limited company or (foreign) legal entity.
Social insurance liability
The question where you are insured after emigration depends on the country of residence, the country (or countries) where you work and how the work is performed (employed or self-employed). This raises the question where you are insured for your health and whether you can continue to use the medical facilities in the Netherlands. Make sure to obtain proper information in advance.
Matrimonial property, succession and inheritance and gift tax
In your new country of residence, you will be faced with the matrimonial property and inheritance regime in force there. When emigrating you should, for example, consider whether there is a conflict with your (Dutch) prenuptial agreement and/or will and whether it needs adjustment.
If you want to make a gift in your (new) country of residence at the time of residence or unexpectedly die, then the beneficiaries in your country will generally be subject to gift and inheritance tax. Some countries have high inheritance and gift tax. Other countries impose absolutely no inheritance and gift tax on acquisitions made by spouses and/or children. Mazars can advise on estate planning opportunities.
You should take note that for the first 10 years following the emigration you will be regarded as a Dutch citizen as resident in the Netherlands for gift and inheritance tax. With a gift within the 10-year period by someone with Dutch nationality, the beneficiary will in principle have to pay Dutch gift tax.
If you emigrate you not only have to deal with tax and legal matters. Practical issues, such as your household goods, demographic registration and deregistration and your car or numberplate, can also have an impact. We can assist you so that you can emigrate without worries.
Would you like to learn more?
Would you like to know more about the tax aspects of emigration? Then talk to Erik Stroeve (tax consultant) by e-mail or by phone: +31 88 277 24 55. He will be happy to assist you.