The Netherlands has concluded a tax treaty with Liechtenstein. This treaty contains agreements that must prevent citizens or companies from paying double taxation on the one hand and tax avoidance on the other.
The treaty was signed in Bern on Wednesday, June 3, 2020. The treaty contains an anti-abuse provision that prevents the treaty from being used only to avoid taxation. If this is the case, the option to invoke the benefits of the tax treaty will lapse. With this anti-abuse clause and the other provisions of the treaty, this tax treaty meets the minimum standards of the so-called BEPS (Base erosion and profit shifting) project of the OECD / G20 against tax avoidance.
In addition, agreements have been made with Liechtenstein on the mutual exchange of information and tax collection assistance. The treaty also contains a provision on binding arbitration in the event that Liechtenstein and the Netherlands do not mutually agree on the position of a taxpayer.
The Convention is consistent with the OECD Model Tax Convention on many aspects. With the signing, the Netherlands has now (except Cyprus) concluded a tax treaty with all countries of the European Economic Area (EEA). The treaty will now go through the required approval process in both countries. In the Netherlands, the treaty is submitted to the Council of State for advice and then to parliament for approval.
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NAZALI TAX & LEGAL |