Dutch companies withhold tax from the dividend they distribute to shareholders: dividend tax. The dividend tax rate is 15%.
If you live or are you established in a country other than the Netherlands and you have shares in a Dutch company you are probably exempted from or receive a refund of Dutch dividend tax.
Exemption or refund
In case of a (partial) exemption, a company already withholds less or no dividend tax from the dividend to be distributed on payment.
If you did not apply for an exemption, you may request (in retrospect) a refund of overpaid divided tax.
Intercompany dividend or portfolio dividend
Your entitlement to an exemption or refund and the amount of this exemption or refund primarily depend on the amount of shares you have in the Dutch company:
- if you have a considerable amount of shares in the Dutch company, it concerns intercompany dividend. Within the EU and the EEA, a minimum percentage of 5% of the shares applies to intercompany dividend. Other percentages apply to other countries, depending on the tax treaty the Netherlands has concluded with the country.
- if you have shares but no intercompany dividend, in that case, it concerns portfolio dividend (investment dividend).
Foreign bodies that are not subject to profits tax
Body established in the EU or Iceland, Norway or Liechtenstein (EEA) or in a “third country” may request a refund of all dividend tax withheld (15%) if it meets the following conditions:
- It is established in a country other than the Netherlands.
- It is not subject to profits tax in the Netherlands.
- If it would be established in the Netherlands, it would not be subject to corporation tax.
- it do not perform any investment activities.
- it is the beneficial owner of the shares.
Body established in a country that is not part of the EU or the EEA may request a dividend tax refund if it meets the following conditions:
- It must concern portfolio dividend.
- The Netherlands and the country in which it is established must have agreed upon a regulation on information exchange.
It is possible to request the refund using the form Application dividend tax refund for foreign bodies with exemption from profits tax (www.belastingdienst.nl).
Author: EMILIO MENEGHELLA