Increase of interest rates

Effective 1 January 2014, the Dutch Government introduced a new interest rate for late payment of corporate income tax (CIT) of at least 8% (for 2014: 8,25%) and for all other taxes - at least 4%. Interest on CIT late payment is imposed for the period starting 1 July the year following the reporting tax period until the date of payment.

The Hague district court issued a judgment concerning value added tax (VAT) on the re-charged fees related to a bank’s use of an external advisor in connection with providing loans to a partnership (one of the bank’s customers).

In the court’s opinion, the re-charging of these fees qualified as a VAT-exempt extension of credit, and thus, no VAT is payable.

On 12 June, 2014 the Court of Justice of the European Union (CJEU) in connection to a Dutch case concluded that Dutch law is not compliant with EU law—i.e., the freedom of establishment—in denying tax consolidation (fiscal unity):
• between a Dutch parent company and its Dutch sub-subsidiary (when the subsidiary is not a resident of the Netherlands); or
• between two Dutch “sister subsidiaries” (when the parent company is not a resident of the Netherlands).
Under Dutch law, a fiscal unity for corporate income purposes cannot be established between sister companies of a foreign parent, or between sister companies and the foreign parent.
It is expected that the Dutch legislator will amend the fiscal unity legislation to bring it in line with the decision of the CJ.