Income tax from an international perspective

If you have international activities, you will have to deal with many complex international laws and regulations. A Dutch resident who receives income and/or holds assets abroad, for example, is faced with foreign income tax in addition to Dutch income tax. A resident abroad who has income or holds assets in the Netherlands on the other hand has to deal with Dutch income tax. Do you know what tax obligations you must meet or what opportunities you have? Mazars can assist!

Living in the Netherlands, taxable abroad

As a resident of the Netherlands you must pay Dutch income tax on your entire worldwide income. So as a Dutch resident you must pay the Dutch Box III tax on your Dutch and foreign savings. If you receive salary from abroad or own a holiday home to abroad, the Netherlands will also include it in the basis for income tax. The country from which the salary originates or where the holiday home is situated will often also claim tax. To avoid double taxation, the Netherlands will in such situations and under certain circumstances make it possible to prevent double taxation on foreign income or foreign assets. 

Living abroad, paying tax in the Netherlands

The country where you are resident will probably charge (income) tax on all your worldwide income. If you have income or hold assets in the Netherlands, the Netherlands will include you as a foreign taxpayer under income tax. This can occur in the following situations:

  • You will receive a salary from a Dutch employer
  • You receive a profit from your Dutch company
  • You receive certain benefits from the Netherlands
  • You own property in the Netherlands and have income from qualifying shareholdings in companies established in the Netherlands.

In contrast, holding a Dutch bank account does not directly trigger Dutch income tax. The country of which you are a resident will typically have a way to prevent double taxation for the income from the Netherlands.

Possibility of opting for resident taxpayer status

Until 1 January 2015, as a foreign taxpayer you can opt to be treated as a resident taxpayer under the same tax rules. The advantage is that you are entitled to the same deductions, tax credits etc as a resident of the Netherlands. On the other hand, there are several drawbacks to opting for resident taxpayer status. Will these disadvantages have an impact on your business?

 The option scheme for resident taxpayer status will expire on 1 January 2015, and a new, mandatory system will be introduced. If you want to be treated as a resident taxpayer, you must make 90% or more of your income in the Netherlands. Would you like to know what options you have to opt for resident taxpayer status? Then please contact us.

Tax implications of emigrating, immigrating or remigrating

Emigrating from the Netherlands or immigrating (or remigrating) to Netherlands can have many tax implications. You need to know the tax consequences clearly in advance. Proper and timely tax planning is necessary for this and can bring substantial tax benefits. The tax experts at Mazars came support you in the tax and legal aspects of your migration. More information about the fiscal impact of migration can be found here.

Would you like to learn more?

Would you like to know more about income tax from an international perspective? Then talk to Erik Stroeve (tax consultant) by e-mail or by phone on: +31 88 277 24 55. He will be happy to assist you.

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