The creditable tax pre-payments for the levy of Dutch income tax

In this Chapter, the following topics will be discussed:

The credit for tax pre-payments

Certain tax pre-payments can be deducted from the income tax liability of resident and non-resident taxpayers and subsequently reduce the ultimate amount of Dutch income tax payable.

Creditable tax pre-payments for resident taxpayers of the Netherlands

For resident taxpayers the following tax pre-payments are in essence creditable:

• the Dutch wage tax (in Dutch: 'loonbelasting') withheld;
• the Dutch dividend withholding tax (in Dutch: 'dividendbelasting') withheld;
• the Dutch game tax withheld or paid (in Dutch: 'kansspelbelasting') from prices and game revenues if these prices/ game revenues form part of the Dutch taxable income;
• the qualifying Community Tax for members of the European Parliament relating to income components which are subject to Dutch tax on the basis of the tax treaty.

The Dutch dividend withholding tax is not creditable if the recipient does not qualify as a beneficial owner of the dividends. The law provides for specific rules to define the term 'beneficial ownership', which aim to exclude certain dividend stripping scenarios.

Furthermore, the Dutch dividend withholding tax is also not creditable if the dividends have effectively not been taxed because tax incentives have been applied to the dividend income.

A special regime applies to taxpayers who qualify as artist, musicians or sportsmen or who belong to a qualifying group of artists, musicians or sportsmen.

The tax pre-payments mentioned above that are taken into account when determining the income tax payable are not considered pre-payments for the income tax due on the basis of a conserving or protective assessment (in Dutch: 'conserverende aanslag').

Under certain specific conditions taxes withheld in Belgium and Germany can qualify as creditable tax prepayments. Foreign dividend withholding tax can - under circumstances and in line with an applicable tax treaty - also qualify for a tax credit.

Creditable tax pre-payments for non-resident taxpayers

For non-resident taxpayers the creditable tax pre-payments are in essence the same as for resident taxpayers with the understanding that for non-resident taxpayers the Dutch dividend withholding tax and the qualifying creditable Belgian and German tax pre-payments are only creditable to the extent that the underlying income constitutes Dutch taxable income. 

What we can do for you?

We are professional tax lawyers and we can advise you on your personal tax position and handle the preparation and filing of your annual Dutch personal income tax return and other tax compliance matters on your behalf.  

We have very competitive rates for individuals and we can prepare and file your personal income tax return (and take care of other personal income tax compliance) on the basis of fixed prices which are agreed upon with you in advance. 

The price for a specific tax return is dependent on your personal circumstances and the service which you wish to receive from us.  

Please feel free to use our ONLINE FEE CALCULATOR for determining the fixed fee which you would have to pay us for the preparation of your personal income tax return.