interested in establishing a business presence in Netherlands
can benefit from the stipulations of the treaty for the avoidance of double taxation
signed between the Netherlands and Germany
. The double taxation agreement (DTA)
was first signed in 1956, but the representatives of the two states signed a new updated version in April 2012.
The new agreement
was established in order to align it with the provisions of the Organisation for Economic Cooperation and Development (OECD). German investors
should know that the Netherlands
represents the Germany's largest trading partner
and that the tax agreement
is favourable for investments; our team of Dutch accountants
can provide assistance on the ways in which income taxes
are applied to companies.
Reduced income taxes under the new German – Dutch DTA
The DTA signed by the two contracting states refers to the taxation of income incurred by tax residents of Germany and the Netherlands.
stipulated, even before the ratification of the new DTA
, that the withholding taxes for interest and royalties
are set at 0%; the regulation is still applicable. The standard withholding tax for dividends
is set out at a rate of 15%, but the new treaty
imposed a new provision, referring to the taxation
at a rate of maximum 10% for dividends
, where the recipient is a Dutch pension fund
, tax resident in the Netherlands
The new treaty
has introduced a lower withholding tax
, from the applicable rate of 10% to a smaller value, set out of at 5%, for the participation of a company, which is not incorporated as a partnership; our team of Dutch accountants
can offer more details in this sense.
Provisions of the treaty referring to capital gains
As a general rule, most of the provisions stipulated under the previous DTA are still applicable, but several changes have been enforced. The new agreement introduces a new stipulation which refers to real estate rich companies.
Businessmen interested in receiving more details on the Netherlands – Germany double taxation treaty
can receive assistance from our Dutch accounting firm.