Additionally, a tax credit generally is available for foreign withholding tax on interest and royalties under the Netherlands’ tax treaties or, if there is no treaty, where interest or royalty income is received from a developing country. Under certain conditions, foreign individuals with Netherlands-source income are treated as a limited national taxpayer, in which case they are taxed on foreign-source income but are entitled to certain credits. A provisional assessment, generally based on information from the previous two years, usually is issued in the first month of the taxpayer’s financial year. There is no specific CFC legislation, but there is an obligation to annually reassess shareholdings of 25% or more in low-taxed companies whose assets consist of at least 90% "passive" assets. (See also “Other,” below.). Losses may be carried forward for nine years and carried back for one year. Box 2 is income from substantial interests (5% or more). Interest on a hybrid loan can qualify as a dividend for tax purposes, in which case the rules for dividends apply. The Netherlands does not levy withholding tax on royalties. All expenses incurred that are necessary to obtain taxable income in Box 1 and Box 2 generally are deductible, except expenses related to employment. Unmarried couples must file a joint assessment if certain conditions are satisfied. Married couples must file a joint assessment unless a petition for a divorce has been filed. Taxation in the Netherlands is based on a ‘box system‘ whereby each box contains certain income which is taxed against a certain tax rate, with tax brackets, credits, allowances, fixed rates etc. If the gain relates to an investment, the gains are not taxed as such in Box 3. Financial statements must be filed annually. Tax preparation, tax filing, tax experts, tax preparers, tax software, tax calculators - if it has to do with taxes, H&R Block has the resources and expertise to help. Profits from a PE of a Dutch company generally are exempt from the Netherlands tax base. ), cooperative and branch of a foreign company. Meet the influencer trying to make travel more inclusive, Watch this adorable giant panda cub's gender reveal, See what Havana's streets look like amid pandemic, Video Tour: New York City is surrounded by beaches, Live like Rajasthani royalty at this 475-year-old palace hotel, Millions in China are traveling again. The Dutch capital will be adding a levy of €3 per person -- about US$3 -- per night for travelers staying overnight in hotels. It is possible to enter into an advance pricing agreement for the use of a certain transfer pricing method. See under “Disclosure requirements,” above. The flat tax on campsites will be €1 (about $1.10) per person per night. Rome currently has the highest fixed price tax in Europe, at €7 per person per night in a five star hotel. If the participation exemption is not applicable, a credit for the underlying tax may be obtained. Which places are worth visiting? From a reporting point of view, all properties entering the possession of a Dutch resident starting with January 1, Dutch citizens with real estate properties abroad must declared them in their tax returns submitted in the Netherlands, however, it should be noted that in this case, special rules under double tax treaties (where such treaties exist) apply. Justin Francis, CEO of Responsible Travel, hailed the move as a positive step.