On 20 May 2026, the Court of Appeal of 's-Hertogenbosch ruled in ECLI:NL:GHSHE:2026:1277 that a dividend paid to a Luxembourg holding company was taxable in the Netherlands.
The case
A Luxembourg company held the shares in Dutch companies of a group active in property management. It was itself held by a Luxembourg private wealth company, whose shareholder lived in Belgium. In 2014, a Dutch subsidiary paid a dividend of €19 million to the Luxembourg company. It was settled against a debt arising from the transfer of a claim. The Luxembourg company had no staff on the payroll and no office of its own. A trust company provided its directors for modest fees.
The inspector issued an additional corporate income tax assessment for 2014 under Article 17(3)(b) of the Dutch Corporate Income Tax Act, which taxes substantial interests held by foreign companies in abusive situations. The district court found for the taxpayer.
The ruling
The Court of Appeal disagreed, applying four recent Supreme Court rulings on this subject. The inspector met his initial burden of proof by thinking the company away. If the Dutch subsidiary had paid the shareholder directly, the dividend would have borne 15% dividend tax and 15% income tax. With the Luxembourg company in the structure, there was no Dutch tax at all. The taxpayer could not provide the evidence to rebut this. The inspector also had a new fact that justified the additional assessment, and was on time.
What to check
- Holding companies between Dutch subsidiaries and a shareholder should ask what Dutch tax would be due if they were not there.
- Substance is part of the picture. Rented directors and no staff or office do not help.
- Information can arrive years later. Here, the inspector acted on what he learned when the shareholder moved.
mr. J. el Khalfioui LL.M.