Dutch Dividend Withholding Tax

If you are a shareholder of a BV or NV and you are entitled to proceeds from shares (directly or through depositary receipts) and there is a possibility that tax on these proceeds will have to be compensated. This depends on the difference between the participation dividend (an organization with 5% or more shares) and an investment dividend (less than 5%).

There is a fixed tax rate but in the case of a participation dividend, there are situations with exemptions. This tax is withholding tax and may therefore again be deducted from income tax or corporation tax. The corporation tax must be deducted by the entity distributing the monies from the shares. Within one month, the company must declare this to the Dutch Tax Authority. With dividend tax, it is important to have an advisor take a look with you so that you know when you qualify for an exemption.

If you have any questions, please do not hesitate to contact us.