Marc Kanter

🇪🇺The #EuropeanCommission has issued a letter of formal notice to the Netherlands for not extending the #Dutch #tax #levy #reduction scheme to foreign investment funds that are comparable to Dutch investment funds (the so-called “#afdrachtvermindering”). 🇳🇱Dutch law allows a reduction in the dividend tax paid by investment funds on dividends received from companies in which they hold shares. This is achieved by offsetting the tax paid by the Dutch company distributing the dividends. 🌎Unlike Dutch investment funds, foreign investment funds cannot offset the dividend tax paid by Dutch companies on dividends they distribute and later redistribute to their own investors. In the Commission’s view, this creates a #disadvantage for #foreign #investment #funds, making it less attractive for them to offer services to Dutch investors & to invest in shares of Dutch resident companies. Three key points: 1️⃣The formal notice is based on the #free #movement of #capital: it therefore also concerns #non-#EU #funds (not only EU funds!). 2️⃣The Netherlands has 2 months to convince the Commission that there is a valid reason not to extend the afdrachtvermindering to comparable foreign funds (including the summer vacation???) 3️⃣This case may look similar to the #Deka case (C‑156/17), though that case involved the old system of the refund of tax withheld on dividends. PwC Nederland #KnowledgeCentre

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🔔 UK Tax Updates for Private Equity 🔔 The Government’s recent announcements have paved the way for expected tax increases and changes to carried interest. My colleague, Lewin Higgins-Green, explores the tax implications for PE firms in this month’s WTS Global Financial Services Newsletter. In addition, PE funds are also being impacted by a recent change in HMRC’s approach and guidance on UK LLP tax structures. Angus Wilson and Lewin have explored the impact for PE firms and their partners. Link below to the Newsletter. Please do reach out if you’d like to discuss any of these issues in more detail. #PrivateEquity #Tax #CarriedInterest #PE

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📊 Budget Day 2025 Update: Key Tax Changes You Need to Know! Today marks an important moment for businesses in the Netherlands. On this Budget Day, the government published the tax plans for 2025. One significant change to highlight is the adjustment in the interest deduction limitation rule, commonly known as the ‘earnings stripping rule.’ 🔹 What’s Changing? The permissible limit for deductible excess interest expenses will increase from 20% to 25% of the adjusted Dutch taxable profit (EBITDA for tax purposes). This adjustment offers a more lenient approach towards the financing costs businesses can deduct. 🔹 Thresholds and Conditions The earnings stripping rule will maintain its threshold where excess interest expenses up to EUR 1,000,000 are not restricted. Additionally, any excess can still be carried forward without limitation, providing flexibility for future fiscal years. 🔹 Special Focus on Real Estate A notable stipulation in the new tax plan targets real estate businesses. If a taxpayer’s adjusted property mainly consists of immovable property for at least half of the year and is made available to someone other than related entities or associated persons, these changes will particularly impact how these assets are taxed. 🔍 Implications These changes could have profound implications for financing strategies and tax liabilities, particularly for businesses heavily invested in real estate or those with significant financing costs. 💬 I’m keen to hear your thoughts on how these changes will impact our industry and your business. Let’s discuss below! #NetherlandsTax #BudgetDay2025 #Finance #BusinessTaxation

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A project we have been working on for the last two years or so: the establishment of our Mazars Financial Services Transfer Pricing Center of Excellence. Check out our website in the link and experience the value added services and solutions that this can bring to your organization #mazars #financialservices #banking #capitalmarkets #insurance #transferpricing #tax #london

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📢 Deadline Belgian Pillar Two Notification Form extended till 𝟭𝟲 𝗦𝗲𝗽𝘁𝗲𝗺𝗯𝗲𝗿 𝟮𝟬𝟮𝟰 ! 🛑 Note: This administrative tolerance for the extended deadline applies only to groups that will not make Belgian advance payments for the 2024 QDMTT and/or IIR. For those planning to make advance payments for the Belgian QDMTT and IIR in 2024, the original deadline remains in effect. 💼 𝗡𝗲𝗲𝗱 𝗔𝘀𝘀𝗶𝘀𝘁𝗮𝗻𝗰𝗲? If you have questions or require support with the Belgian Pillar Two Notification Form, please reach out to the EY contact person on this alert. #PillarTwo #QDMTT #FPSFinance

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On 7 November 2024, the District Court of Northern Netherlands ruled that the interest rate on corporate income tax assessments is disproportionate and should align with the interest rate applied for other taxes. This significant judgment may lower the tax burden for affected taxpayers. More info? Check: https://lnkd.in/eAs8guzk Questions? Please contact Ivo Kuipers, Mats Nietzman or Joël van de Sluis. #atlasfiscalisten #svalneratlasgroup #corporateincometax #interestrate

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Loyens & Loeff New York regularly posts ‘Snippets’ on a range of EU tax and legal topics. In a previous Snippet, we described hybrid financing arrangements (𝐇𝐅𝐀𝐬) under article 3.2.7 of the Pillar Two (𝐏𝟐) model rules: https://lnkd.in/e294m5y5. This Snippet describes the treatment of certain HFAs under the P2 guidance published by the OECD in December 2023 (the 𝐆𝐮𝐢𝐝𝐚𝐧𝐜𝐞) for purposes of the transitional country-by-country reporting safe harbour (𝐒𝐇) rules. ➡ The SH rules temporarily allow an MNE to avoid undertaking detailed P2 calculations in respect of low-risk countries in the initial P2 years by making use of its existing country-by-country report and financial accounting data with little to no modifications. The SH rules do not contain a provision equivalent to article 3.2.7 of the P2 model rules. ➡ As the OECD became aware that HFAs were implemented by taxpayers during the SH period, it published the Guidance. Under the Guidance, a taxpayer must exclude expenses relating to HFAs from its SH income if such HFA was entered into after (in principle) December 15, 2022 (the release date of the OECD SH guidance). The Guidance lists three categories of HFAs: (i) deduction/non-inclusion arrangements (𝐃/𝐍𝐈) (ii) duplicate loss arrangements and (iii) duplicate tax recognition arrangements. In this Snippet, we solely discuss D/NI. ➡ A D/NI is defined in the Guidance as an arrangement whereby an entity makes a payment that is taken into account as an expense in its financial accounts without a commensurate increase in (a) the revenue in the financial accounts or (b) the taxable income at the level of the recipient. Therefore, it targets both mismatches between (i) the accounting treatment of both countries involved and (ii) the treatment for accounting and tax purposes. The use of a tax attribute (e.g., NOLs) to offset the income may also fall within the scope of the latter. ➡ An example of a D/NI is a loan granted by a US parent entity (𝐔𝐒𝐂𝐨) to its disregarded EU sub (𝐃𝐑𝐄). The DRE will report an interest expense in its financial accounts with no commensurate increase in the taxable income of USCo due to the disregarded status of DRE for US tax purposes. This means that the expense will not be taken into account for purposes of the SH calculations of the jurisdiction of the DRE. The fact that the deduction of the expense by DRE may be denied for tax purposes under the EU anti-hybrid rules (ATAD 2) does not change this conclusion since the ATAD 2 rules do not impact the financial accounts of DRE. Want to know more? 👉 Reach out to Steffie Klein, Lisanne Bergwerff or myself. #loyensloeff #lawandtax #Pillartwo #USA #EU

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📢 Important Tax Update: North Netherlands Court Ruling and Implications for Corporate Taxes 📢 Dear [LinkedIn Network], I want to share a significant development that could impact businesses' tax obligations. In November 2024, the North Netherlands Court ruled that the previously applied 8% interest rate on corporate tax assessments for 2021 was disproportionate and has now reduced it to 4%. 💡 **Why does this matter?** If your company has paid tax interest on (provisional) assessments or required tax payments, you may want to consider potentially appealing to recover some of those costs. Additionally, corporate and income tax interest rates have been rising: - Corporate tax rates have increased from 4% to 10% since 2022. - Income tax rates rose from 4% to 7.5% in 2024. These increases have been criticized for being out of line with current market rates, and there may be opportunities to challenge them as well. 🔍 **What's next?** The tax authorities may appeal the Court's decision, so staying updated on any further developments is crucial. We're here to help you navigate these changes and evaluate your options. Please reach out if you would like to discuss how these changes could affect your tax situation or if you're interested in exploring potential appeals. 

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The Dutch tax qualification rules for both Dutch and foreign limited partnerships, as well as for a fund for joint account, will change starting in 2025. Under the new rules, a limited partnership may also qualify as a "fund for joint account" following the respective tax qualification for a fund for joint account and not for a limited partnership. New rules are proposed for restructuring options.

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Pillar Two update - The Belgian tax authorities published today a message that they will provide an administrative tolerance until 16 September for the notification form for Pillar Two for entities that will not carry out advance payments in 2024 for (Belgian) domestic top-up tax or IIR. For groups that wish to carry out advance payments in 2024, the deadline remains 13 July. https://lnkd.in/eYPP54DE #Deloitte #PillarTwo

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Important upcoming BEPS filing requirment. Multinationals subject to Pillar Two, having either a Belgian ultimate parent entity, or one (or more) Belgian constituent entity(ies), are required to file a Pillar Two Notification in Belgium by 13 July 2024 (or 30 days following the start of the financial reporting year for the MNE group if this is later). The volume of information required to be disclosed in the P2 Notification Form is substantial (requires entity P2 qualification understanding) and is detailed in the attached alerts.

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Loyens & Loeff NY regularly posts ‘Snippets’ on a range of EU tax and legal topics. This Snippet describes the treatment of hybrid financing arrangements (𝐇𝐅𝐀𝐬) under Pillar Two (𝐏𝟐), specifically under the anti-avoidance rule in article 3.2.7 of the P2 model rules. This rule targets taxpayers that are creating a deduction in a low-tax jurisdiction without a corresponding inclusion in taxable income in a high-tax jurisdiction. ➡ Before P2, mismatches arising from HFAs only concerned differences in treatment for tax purposes. This changed under P2 as HFAs can now also arise due to a mismatch in the accounting treatment or as a result of a mismatch in the treatment for accounting and for tax purposes. An instrument could for instance be treated as debt for accounting purposes and as equity for tax purposes (a 𝐇𝐲𝐛𝐫𝐢𝐝 𝐋𝐨𝐚𝐧). ➡ The effective tax rate (𝐄𝐓𝐑) for P2 purposes is determined by dividing the covered tax (𝐏𝟐 𝐓𝐚𝐱) by the income recognized for P2 (𝐏𝟐 𝐈𝐧𝐜𝐨𝐦𝐞). If a constituent entity is located in a jurisdiction with an ETR < 15%, the ETR can be increased by granting a Hybrid Loan to that entity. The ETR of the low-taxed entity would increase as interest expenses on the Hybrid Loan will be recognized in the financial accounts (decrease of P2 Income) but not in the tax accounts (no decrease of P2 Tax). A simplified example to illustrate this: ➡ As a starting point, ACo has an ETR of 20% as it has P2 Income of 1,000 and P2 Tax of 200. BCo has an ETR of 10% as it has P2 Income of 200 and P2 Tax of 20. ACo grants a Hybrid Loan to BCo with an annual interest accrual of 100. The Hybrid Loan reduces the P2 Income of BCo from 200 to 100, while its P2 Tax remains 20 (no interest deduction for tax purposes). Therefore, the ETR of BCo increases from 10% to 20% (20/100) as a result of the Hybrid Loan. The P2 Income of ACo increases to 1,100 and its P2 Tax remains 200 and, hence, its ETR will slightly decrease from 20% to 18.18% (200/1100). No P2 tax will be due in relation to either ACo or BCo as a result. ➡ Article 3.2.7 of the P2 model rules is an anti-abuse provision aimed at preventing taxpayers from increasing the ETR of a low-tax entity, such as by granting a Hybrid Loan to that entity without a corresponding increase in the taxable income of a high-tax entity. Article 3.2.7 provides that, for purposes of computing P2 Income, interest expenses on a Hybrid Loan are ignored but the corresponding interest income is still included in the P2 Income of the lender. ➡ In the example above, on the basis of article 3.2.7, the interest due by BCo under the Hybrid Loan would be ignored for purposes of computing BCo’s P2 Income and, hence, its ETR would remain 10%. The interest income would still be included in the P2 Income of ACo and its ETR would decrease from 20% to 18.18%. Want to know more? Reach out to Steffie Klein, Lisanne Bergwerff or myself. #loyensloeff #lawandtax #Pillartwo #USA #EU

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Loyens & Loeff NY regularly posts 'Snippets' on EU tax and legal topics. This Snippet describes proposed changes to the Dutch conditional withholding tax (𝐂𝐖𝐓) rules under the 2025 Dutch tax plans. The changes are good news for US asset managers with investment platforms in the Netherlands (𝐍𝐋). ➡️ NL generally does not levy withholding tax (𝐖𝐇𝐓) on interest and royalty payments and has a broad dividend WHT exemption for dividends. However, 25.8% CWT is levied on interest, royalty and dividend payments to entities that are (i) opaque for Dutch tax purposes, (ii) located in low-taxed / blacklisted jurisdictions (𝐋𝐓𝐉) and (iii) that own a(n) (in)direct interest of >50% in the Dutch payor. Regarding condition (ii), CWT is also levied in abusive situations (e.g., when an entity in a treaty jurisdiction is interposed to mitigate CWT) and in case of certain payments to hybrid entities. ➡️ Before 2024, limited partnerships in fund structures (𝐅𝐮𝐧𝐝 𝐋𝐏𝐬) were often considered hybrid entities under the CWT-rules (opaque in NL / transparent in the other country). This meant that payments to Fund LPs would be subject to CWT. An escape applies if, under a look-through approach, Fund LP does not have investors that hold (i) a ‘qualifying interest’ (i.e., >50% interest) and (ii) are resident in an LTJ. It is unlikely that any investor in Fund LP holds an interest of >50% on a standalone basis and is also located in an LTJ. ➡️ However, the definition of ‘qualifying interest’ includes a cooperating group (𝐂𝐆) concept, which is not defined in Dutch tax law. There is currently a risk that investors in Fund LP could be a CG and that one LTJ-investor in Fund LP could taint the whole CG for CWT purposes. For example, if an LTJ-investor in Fund LP holds a 10%-interest, 100% of a dividend payment made to Fund LP would be subject to CWT in case of a CG. ➡️ As from 2024, Fund LP is already considered transparent for CWT purposes in respect of dividends received, provided Fund LP is not located in an LTJ. This resulted in CWT only being due on the portion of the dividend allocable to LTJ-investors. In our example, only 10% of the dividend would be subject to CWT. ➡️ To further improve the Dutch investment climate, a much narrower group concept for CWT purposes is proposed. The new concept, referred to as a ‘qualifying unit’ (𝐐𝐔), only applies if entities act jointly with (one of) the main purpose(s) to avoid one of those entities being subject to CWT. The burden of proof regarding existence of a QU lies with the tax inspector. Fund LPs are generally not set up to avoid CWT and and should therefore not qualify as QU. The uncertainty regarding the CG concept is thus no longer there. For our example, this could mean that the distribution to Fund LP should no longer be subject to CWT at all. Want to know more? 👉 Reach out to Laurens Hoek or myself. #Loyens&Loeff #lawandtax #2025Dutchtaxplans #EU #USA

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Tax professionals in the Netherlands are in high demand. But what are employers looking for? According to our latest tax salary guide, businesses require tax specialists that excel in areas of; transfer pricing, tax automation or compliance and reporting process optimization. Download our tax salary guide 2024 to find out more and benchmark your salary: https://lnkd.in/gPc_Z6dW #BrewerMorris hashtag #tax hashtag #taxrecruitment hashtag #taxsalaries

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The Dutch Tax plan 2025 that was published today includes several proposals that are relevant for international companies. The key topics are discussed in below alert.

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Important #tax update: Belgium has introduced new content requirements for the #TransferPricing forms (Local File Form, Master File Form, and CbCR Notification Form) through a Royal Decree dated 14 July 2024. These changes will take effect for financial years starting on or after 1 January 2025, requiring companies to disclose and file substantially more information than before. Read more: https://bit.ly/4ca6PHa #KPMGBelgium #OECD #TaxRegulations

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In this latest edition of Global Tax Talk, Keetie van der Torren-Jakma and I talk about the EU Foreign Subsidies Regulation.

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Dutch CV’s we understand these are to become transparent with effect from January 2024. Do you have any Dutch Cv’s that own property in the U.K.? Talk to the tax team at Wilder Coe there are issues in the U.K. in resolving g your Dutch issues #wildercoe #property #paulinehudd #etl

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The Belgian #Tax Authorities have opened a public consultation on the draft (Q)DMTT-return, with a deadline of 8 November 2024. With the first (Q)DMTT filing deadline set for 30 November 2025 (for fiscal years ending on 31 December 2024), businesses face a limited window to prepare. This public consultation aims to gather insights that will help finalize the return template and XSD-schema. Don’t forget, Belgium's minimum taxation law also introduces a prepayment system for the (Q)DMTT and the IIR Top-up Tax. Make sure your organization is ready—timely preparation is key! Find out more: https://bit.ly/3UjyAXT #Belgium #KPMGBelgium #KPMGTax

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