Keywords: dividend withholding tax, amendments,  tax, conditional,

The emergency bill `Conditional exit Dividend Withholding Tax´ is designed to tax profit reserves in the event of a "tainted" reorganization. Tained reorganizations concern cross-border mergers, cross-border legal splits, cross-border share mergers or an emigration to a qualifying state. This bill aims to change the minds of companies considering moving their headquarters from the Netherlands to a foreign country. Recently other amendments have been made to this bill focusing it on situations involging non-EEA/EU states[1]:

  • The exit tax on dividend tax will be levied only on investors in non-EU/EEA states with which the Netherlands has not concluded a tax treaty.
  • The exit tax on dividend tax will only be triggered if a company departs to a non-EU/EEA state that does not levy dividend tax itself or provides a step-up upon entry.
  • The system of the conservative additional tax assessment will be abandoned. Instead, the proposed exit tax on dividend withholding tax will be embedded in the existing dividend withholding tax system and levied acutely without the possibility of deferring payment or remission.
  • Specifically with respect to the transfer of registered office, an additional measure is proposed under which a company incorporated under foreign law will, in certain circumstances, be deemed to be resident in the Netherlands for tax purposes for a period of ten years after the transfer of its registered office (effective management).
  • The retroactive effect of the bill will be limited to Wednesday, December 8, 2021, 09.00 hours.

[1] Voorstel van wet van het lid Van der Lee tot wijziging van de Wet op de dividendbelasting 1965 en enige andere belastingwetten in verband met de invoering van een conditionele eindafrekening (Spoedwet conditionele eindafrekening dividendbelasting) | Tweede Kamer der Staten-Generaal. (2021). Tweede Kamer. Geraadpleegd op 13 december 2021, van



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