Dutch Substance Requirements Sharpened.
Interest and royalty payments made by Dutch entities resident in the Netherlands are currently not subject to withholding tax in the Netherlands. This will change as from 2021 onward, interest and royalty payments to affiliated entities in designated low-tax jurisdictions will become subject to an expected withholding tax of 21,7%. The same applies to abusive situations, e.g. where payments are artificially diverted.
Have you already reviewed if your interest and royalty structure will be impacted? Caius can help you to review, amend and help to provide creating the appropriate substance for your structure.