Tax year and payment dates

1. When does the official tax year start and finish in your jurisdiction and what are the tax payment dates/deadlines?

Income tax

The official income tax year for individuals runs from 1 January to 31 December. Taxpayers must file their tax declaration before 1 April in the assessment year. The assessment year is the calendar year following the tax year (for example, for the tax year 2012, taxpayers must file tax declarations before 1 April 2013).

Postponement is possible on request. However, the final assessment must be made within three years of the end of the tax year concerned. The tax must be paid within six weeks of notice of the assessment.

Gift and inheritance tax

Gift tax declarations must be filed within two months of the end of the calendar year in which the donation was made. Declarations for inheritance tax must be filed within eight months from the date of death. Postponement is possible on request.

Domicile and residence

2. What concepts determine tax liability in your jurisdiction (for example, domicile and residence)?In what context(s) are they relevant and how do they impact on a taxpayer?


There is no concept of domicile in The Netherlands.


Residence is important for tax purposes (see Questions 3 to 7). Residence is to be determined according to the circumstances. The decisive factor for determining residence is the taxpayer’s centre of vital interests (that is, the country where his closest economic and family relationships are located). Under case law, the location of the following are considered particularly relevant:

  • A permanent home.
  • The place where the spouse and children live.
  • The individual’s personal and economic relations (for example, the place of employment).

Taxation on exit

3. Does your jurisdiction impose any tax when a person leaves (for example, an exit tax)? Are there any other consequences of leaving (particularly with regard to individuals domiciled in your jurisdiction)?

Emigrating individuals with a substantial shareholding, defined as 5% or greater in a body corporate (see Question 6), are treated as disposing of their shareholding. This deemed disposition is provisionally subject to 25% tax on capital gains on the shareholding.

The emigrating individual receives a tax assessment that is not collected in advance and must provide security if emigrating outside the European Economic Area (EEA). The assessment is collected if the individual disposes of his shareholding in the ten years following his exit. If the value of the shareholding decreases after his exit, the tax rate is reduced by 25% of the amount of the decrease in value. At the end of the ten-year period, the (remaining amount of) tax assessment is remitted.

Similar rules apply to emigrating individuals who have paid annuity or pension premiums. Tax is triggered if the taxpayer:

  • Transfers the annuity policy for a profit or gives security over the policy.
  • Receives a lump-sum pension payment.

The same ten-year time limit applies.

In addition, emigrating individuals may be liable to exit taxes on capital sums built up under an insurance policy on an owner-occupied dwelling.

If a Dutch national leaves The Netherlands, he is deemed to be tax resident in The Netherlands, for gift and inheritance tax (IHT) purposes, for the following ten years. If a non-Dutch national leaves, he is deemed to be tax resident for the following year, for gift tax purposes only.

Temporary residents

4. Does your jurisdiction have any particular tax rules affecting temporary residents?

Employees who are temporarily assigned to The Netherlands from abroad are known as extra-territorial employees. If these employees meet certain conditions, they are eligible for a special expense tax-free allowance known as the 30% facility. Under this facility, 30% of the wages may be provided tax-free as compensation for the additional costs of the employee’s temporary stay in The Netherlands.

To qualify for the 30% facility, the employee must have a specific expertise that is rare in the domestic labour market. The preferential tax regime is available for eight years, starting from the date of employment in The Netherlands. If the employee has started before 2012, the preferential tax regime will be available for ten years. The same rule applies if a non-resident taxpayer is hired and based abroad while working for an employer based in The Netherlands.

Employees temporarily staying in The Netherlands and benefiting from the 30% facility have the additional benefit that they may opt to be taxed as non-resident taxpayers for Boxes 2 and 3 of Dutch income tax (see Question 6). Generally, this means that they are not taxed on substantial shareholdings in foreign corporate bodies and savings and investments. Investment in Dutch real estate remains taxable under Box 3 (see Question 6).

Taxes on the gains and income of foreign nationals

5. How are gains on real estate or other assets owned by a foreign national taxed? What are the relevant tax rates?

Gains on property or assets can be subject to income taxation (see Question 6). Gains resulting from the normal administration of private wealth consisting of immovable property (including dwellings) are generally tax free, unless they result from activities going beyond normal property management (see Question 6).

Capital gains resulting from a person’s labour outside the course of business or employment may be categorised as income from independent services and taxed at progressive rates. However, the volume of labour must be greater than required for wealth management.

Capital gains on shares are only taxable if the shareholding constitutes a substantial shareholding (that is, at least 5%). Regular income and capital gains from a substantial shareholding are taxed at a flat rate of 25% (see Question 6). This applies to both residents and non-residents. For non-residents, tax is only levied on capital gains on their substantial shareholding in resident companies in The Netherlands.

All other assets are deemed to produce a gain of 4% of their actual value per year that is subject to income tax at a flat rate of 30%. Income tax is paid yearly on a deemed gain in certain assets (see Question 6).


6. How is income received by a foreign national taxed? Is there a withholding tax? What are the income tax rates?

Non-resident individuals pay tax on all domestic income. Resident individuals are subject to tax on their worldwide income. There are three categories or boxes of income. The tax rates vary, depending on the category.

Box 1: income from employment and dwellings

This includes:

  • Income from business activities.
  • Income from present and past employment.
  • Income from other activities that cannot be qualified as business activities or employment (any freelance activity, for example, occasional lecturing and consultancy work).
  • Periodic payments received from individuals (for example, alimony) or insurance companies (for example, a pension).
  • Periodic payments received from the state or a public body (for example, the state pension).
  • Income from owner-occupied dwellings.

Income falling into this category is subject to a progressive tax with rates ranging from 1.85% to 52%. In addition, income from employment is subject to a withholding tax.

In Box 1, only a limited number of deductions are available. The most important of these relates to interest paid on a loan contracted for the acquisition, improvement and maintenance of the taxpayer’s principal, owner-occupied residence. The interest is, in principle, fully deductible for a period of 30 years. If a mortgage loan was taken out before 1 January 2001, the 30-year period commences on 1 January 2001.

In the Coalition Agreement published on 29 October 2012, it was announced that with effect from 1 January 2013, all mortgages signed on or after that date must contain a redemption clause which stipulates that the loan must be repaid in full within a 30-year period. In addition, with effect from 1 January 2014, the deductibility of the mortgage interest will be reduced by 0.5% per year. This reduction will apply for both existing and new mortgages. In 2014, the mortgage interest will be deductible at a maximum rate of 51.5% instead of the current 52% (the top rate of income tax). After 28 years, therefore, a mortgage interest will only be deductible at the rate of 38%.

Box 2: income from substantial shareholdings

Income from a substantial shareholding (that is, at least 5% of a company’s shares) includes dividends and capital gains, and is taxed at a flat rate of 25%. For non-resident taxpayers this box only applies to shares held in resident companies. Dividends received from a substantial shareholding are taxed on a cash basis when they are received and capital gains on a substantial shareholding are taxed in the year of the (deemed) disposal.

Dividends paid by resident companies are subject to a 15% withholding tax. This withholding tax may be offset against Dutch income tax by resident taxpayers.

Box 3: income from savings and investments

Property and assets in this category are deemed to produce a net yield of 4% per year of their actual value. Assets and debts are valued on 1 January of that year. The net yield is taxed at a flat rate of 30%. This translates into an annual tax of 1.2% on the actual value of the capital assets. The income tax cannot be negative (for example, where liabilities exceed assets).

Assets which are subject to tax under Box 3 include:

  • All tangible and intangible assets.
  • Second houses.
  • Movable property used for personal use (for example cars, yachts and art collections), that are mainly held as an investment.

Certain categories are excluded from the yield assessment, such as:

  • Movable property used for personal use that is not mainly held as an investment.
  • Certain approved investments and monies below a certain value.

For non-resident taxpayers, taxation in Box 3 is limited to Dutch real estate and associated direct or indirect rights.

Inheritance tax and lifetime gifts

7. What is the basis of the inheritance tax or gift tax regime (or alternative regime if relevant)?

IHT is payable on the worldwide property of the deceased, who is (deemed to be) a resident in The Netherlands at the time of his death (see Question 2 and Question 3).

A gift tax is levied on gifts from a donor who is (deemed to be) a resident in The Netherlands (see Question 2).

IHT and gift tax rates differ, depending on the beneficiary (see Question 8). The IHT and gift tax rates do not depend on the beneficiary’s wealth.

In relation to non-residents, see Question 10.

8. What are the inheritance tax or gift tax rates (or alternative rates if relevant)?

Tax rates

Both for IHT and gift tax, the following rates apply, depending on the beneficiary:

  • 10% (up to EUR115,708) to 20% (on the remaining amount) for transfers to spouses, cohabitants and children.
  • 18% (up to EUR115,708) to 36% (on the remaining amount) for transfers to direct descendants in the second or further degree (for example, grandchildren).
  • 30% (up to EUR115,708) to 40% (on the remaining amount) for transfers to parents, brothers and sisters, and non-related persons.

Tax free allowance

For IHT, the most important tax-free allowances are (in 2012):

  • For partners:
    • there is a tax free allowance of EUR603,600 (as at 1 October 2012, US$1 was about EUR0.8). However, half of the cash value of any pension rights derived by a partner from the death of the deceased are deducted from this amount; with the condition that a minimum allowance of EUR155,930 always remains;
    • any inheritance of pension rights or certain annuities comparable to pension rights is exempt from IHT.
  • For children there is a tax free allowance of EUR57,342 where both:
    • the child’s cost of living was for the main part paid by the deceased;
    • it is expected that within the coming three years, the child will not be able to earn half of the income a physically and mentally healthy person would earn.
  • For other children and grandchildren: EUR19,114.
  • For parents: EUR45,270.
  • For others: EUR2,012.

For gift tax, the following annual tax-free allowances apply (in 2012):

  • For children: EUR5,030.
  • For others: EUR2,012.

In addition, there is a single tax-free allowance of EUR24,144 for gifts to children aged between 18 and 35. Subject to strict conditions, this allowance is raised to EUR50,300 if the money is used by the child to buy or maintain a house or finance “expensive” studies.


Transfers to designated charitable organisations are exempt from IHT and gift tax.

The following IHT and gift tax exemptions apply to entrepreneurial assets and substantial shareholdings that represent entrepreneurial assets (subject to the satisfaction of strict conditions):

  • The difference between the liquidation value of a business and the value as a going concern can be tax exempt.
  • The first EUR1 million of the business’ value as a going concern and 83% of the excess above that amount can be tax exempt.
  • For tax on the remaining 17% of the business’ value as a going concern (over EUR1 million), a conditional extension for payment for a period of ten years can be obtained.

The main condition for these exemptions is that the business must be continued for a period of five years after the gift or death of the deceased. The transfer of designated rural estates is partially exempt from IHT and gift tax, again subject to strict conditions.

The district court of Breda ruled in its decision of 13 July 2012, that the business succession facilities for inheritance (and gift) tax contravene the prohibition of discrimination under both:

  • Article 14 of the European Convention on Human Rights.
  • Article 26 of the International Covenant on Civil and Political Rights.

Therefore, the district court has permitted the application of the business succession facilities on non-business assets. The state secretary of finance has lodged an appeal against this decision. The result of this process is uncertain. The business succession facilities will possibly be limited or abolished by the legislator, although the state secretary of finance indicated that the ruling of the district court of Breda contravenes with a ruling of the Dutch Supreme Court.

Techniques to reduce liability

By making annual gifts of an amount equal to the 10% rate band (plus the annual tax free allowance) the tax liability on the transfer of wealth to the next generation can be reduced from 20% to 10%. A gift can also be made in the form of an acknowledgement of a debt by the parent to the child, being due and payable upon the parent’s death. This type of gift must be entered into a notarial deed.

The acquisition of property by parents for the children’s benefit, with the parents acquiring a life interest (usufruct) in the property, cannot avoid the application of IHT.

9. Does the inheritance tax or gift tax regime apply to foreign owners of real estate and other assets?

Gift tax

Gifts by a Dutch resident, of either movable or immovable property, are subject to gift tax. If a non-resident taxpayer transfers movable property as a gift, no gift tax is due.

The acquisition of Dutch real estate from both non-resident and resident donors, is subject to 6% real estate transfer tax (overdrachtsbelasting). The rate is lowered to 2% for the acquisition of dwellings (whether or not the dwelling is for private use or as an investment). For resident donors it is possible to (partially) offset the real estate transfer tax (see Question 11) against the gift tax.

Inheritance tax

No inheritance tax is payable on a non-resident’s immovable property that is situated in The Netherlands. A resident’s worldwide property is subject to inheritance tax.

If Dutch real estate is acquired by way of inheritance, this is not considered taxable for Dutch real estate transfer tax.

10. Are there any other taxes on death or on lifetime gifts?

There are no other taxes on death or on lifetime gifts.

Taxes on buying real estate and other assets

11. Are there any other taxes that a foreign national must consider when buying real estate and other assets in your jurisdiction?

Purchase and gift taxes

Except for newly constructed buildings, transfers of immovable property are subject to real estate transfer tax, set at 6% of the market value of the property. The real estate transfer tax rate is set at 2% for the acquisition of dwellings. Newly constructed buildings are considered new until 31 December of the second year following the year of the building’s first use. A sale of a newly constructed building is subject to value added tax (VAT) at 21%.

A majority of transfers of land are subject to real estate transfer tax, but transfers of building sites are subject to VAT.

Annual rates

A separate local tax, calculated on the basis of the immovable property’s value, as determined by the local government, is levied on real estate (onroerende zaakbelasting). The tax rate varies, depending on the municipality.

Wealth taxes

There is no wealth tax. Wealth tax is considered to be included in Box 3 of Dutch income tax (see Question 6).

12. What tax-advantageous real estate holding structures are available in your jurisdiction for non-resident individuals?

Transfers of shares in a holding company are subject to a 6% real estate transfer tax if:

  • At least 50% of the assets comprise immovable property.
  • At least 30% of the immovable assets are located in The Netherlands.

The taxation is limited to the value of the immovable property located in The Netherlands. If the shares in the holding company are sold, the corporate tax on the capital gain may be deferred.

If the immovable property is sold, corporate tax will be due unless it is possible to form a so-called “reinvestment reserve”, in which case the capital gain is deferred

Taxes on overseas real estate and other assets

13. How are residents in your jurisdiction with real estate or other assets overseas taxed?

Dutch resident taxpayers are subject to income tax on their worldwide income and assets, unless they have received non-resident taxpayer status (see Question 4). Depending on the asset or activity, income tax is levied in Box 1, Box 2 or Box 3 (see Question 6).

International tax treaties

14. Is your jurisdiction a party to many double tax treaties with other jurisdictions?

Income tax

In relation to income tax, The Netherlands has entered into many double taxation treaties, for example with Australia, China, the UK and the US. Tax treaties override domestic law. Under most tax treaties concluded by The Netherlands, double taxation is generally avoided by the exemption with progression method. The exemption is granted in the form of a reduction in the amount of tax by a percentage equal to the proportion of worldwide income formed by foreign-source income.

However, the credit method generally applies to withholding tax on dividends, interest and royalties (that is, the individual is taxed in both states but the state of residence gives credit for tax paid in the other state).

IHT and gift tax

In relation to IHT, The Netherlands has entered into seven double taxation treaties, including treaties with Israel, the UK and the US.

In relation to gift tax, The Netherlands has entered into treaties with Sweden and the UK.

Governing law and formalities

15. Is it essential for an owner of assets in your jurisdiction to make a will in your jurisdiction? Does the will have to be governed by the laws of your jurisdiction?

It is not essential for an owner of assets located in The Netherlands to make a will in The Netherlands. Under Dutch conflict of law rules, the succession laws of the deceased’s last country of residence will apply, provided the deceased was also a citizen of that state. No distinction is made between movable and immovable property.

Under Dutch conflict of law rules, the testator can elect either the law of his last residency or the law of his citizenship country to govern the succession to his estate. The formalities of a choice of law clause are the same as for a will (see Question 17).

Dutch intestacy rules apply to non-Dutch citizens who were resident in The Netherlands for a minimum of five years immediately before death.

16. What are the formalities for making a will in your jurisdiction? Do they vary depending on the nationality, residence and/or domicile of the testator?

Generally, a will is executed in the form of a deed, prepared by a Dutch civil law notary. A holographic will (that is, handwritten by the testator) is also possible, although very uncommon. This type of will must be deposited by a Dutch civil law notary. In a deed the testator must declare, among other things, that his holographic will both:

  • Meets the statutory standards.
  • Is deposited by the civil law notary executing the deed.

Dispositions of clothing, personal objects, jewellery, furniture and specific books can be made in a codicil that needs to be handwritten, dated and signed by the testator.

Redirecting entitlements

17. What rules apply if beneficiaries redirect their entitlements?

Beneficiaries cannot make a post-death variation. Preparation of a will is a strictly personal matter that cannot be delegated to the beneficiaries. However, the beneficiaries can reach an agreement (settlement) among themselves, which is not deemed to alter the passing of the deceased’s estate. Transfers of property under this type of agreement are regarded as donations subject to standard taxes.

An agreement made by the beneficiaries regarding an interest over the children’s claims (resulting from the statutory division or a similar testamentary arrangement) is valid and is not regarded as a donation, provided that:

  • The deceased empowered the beneficiaries to make such an agreement.
  • The agreement is concluded within the period required to submit the inheritance tax declaration (see Question 21).

For IHT purposes, this agreement is regarded as a disposition made by the deceased.

Validity of foreign wills and foreign grants of probate

18. To what extent are wills made in another jurisdiction recognised as valid/enforced in your jurisdiction? Does your jurisdiction recognise a foreign grant of probate (or its equivalent) or are further formalities required?

Validity of foreign wills

The Netherlands is party to the HCCH Convention on the Conflicts of Law Relating to the Form of Testamentary Dispositions 1961 (Hague Testamentary Dispositions Convention). Under the convention, a will made in another jurisdiction is recognised as valid if its form complies with the internal law of the:

  • Place where the testator made it.
  • Country of the testator’s nationality, domicile or habitual residence (either at the time when he made the will or at the time of his death).
  • Place where the assets are located (for immovable property).

Validity of foreign grants of probate

Dutch conflict of law rules provide that, in principle, the law governing succession also governs the transfer of possession and administration of the estate. Therefore, a foreign grant of probate is recognised if it complies with the formalities prescribed by the law governing the succession.

19. Are there any relevant practical estate administration issues if foreign nationals die in your jurisdiction?

No practical issues are particularly relevant if foreign individuals die in The Netherlands. Their bank assets may be frozen for a period of time, but this can generally be easily resolved.

Administering the estate

20. Who is responsible for administering the estate and in whom does it initially vest?

Responsibility for administering

If the deceased has appointed an executor with the authority to administer the estate, the executor represents the heirs during administration. The executor can sell the deceased’s assets if there are insufficient funds to discharge all the legacies. In all other cases, the executor requires the heirs’ unanimous consent to dispose of the assets. The deceased can limit the executor’s authority. For example, he can be responsible only for handling the funeral or the payment of a specific legacy.

If the deceased has expressly authorised the executor to act as a settlement administrator (afwikkelingsbewindvoerder), the executor can dispose of the estate without the heirs’ consent. Once the executor completes his task, he must submit an account of the estate administration.


The deceased’s estate passes directly to the heirs (saisine), unless the deceased provides otherwise.

21. What is the procedure on death in your jurisdiction for tax and other purposes in relation to:
• Establishing title and gathering in assets (including any particular considerations for non-resident executors)?
• Paying taxes?
• Distributing?

Establishing title and gathering in assets

There are no special formalities in relation to transfer, gathering in and administration of the estate. The heirs can take possession of all of the deceased’s assets from the moment of death (see Question 20).

Procedure for paying taxes

Together with the executor, the heirs must file the IHT return for the entire estate within the prescribed time limit (see Question 22). Other categories of beneficiaries must file an IHT return in certain circumstances (for example, after receiving the proceeds of the deceased’s life insurance).

The heirs and legatees must pay IHT on their respective shares in the estate. The heirs are liable for the IHT due from the legatees (limited to the heirs’ proportionate share in the estate). The executor can be held liable for the IHT if the heirs provide insufficient opportunity for recovery.

Distributing the estate

The estate is generally distributed according to a notarial deed.

22. Are there any time limits/restrictions/valuation issues that are particularly relevant to an estate with an element in another jurisdiction?

The deadline for filing the IHT tax return is eight months from the deceased’s death (postponement is granted on request). The tax must be paid within six weeks of the notice of assessment.

If an heir or legatee living abroad receives property from a Dutch resident’s estate, the heirs who live in The Netherlands are liable for the payment of the non-resident heir’s or legatee’s taxes.

23. Is it possible for a beneficiary to challenge a will/the executors/the administrators?

A beneficiary can challenge a will on the following grounds:

  • The testator’s incapacity.
  • Forbidden donations, for example a donation to a medical doctor during the treatment of the deceased or to a clergyman during ministering the deceased.

A beneficiary can request a sub-district court (kantonrechter) to discharge the executor or the administrator for a substantial reason, for example maladministration.

Succession regimes

24. What is the succession regime in your jurisdiction (for example, is there a forced heirship regime)?

The children of the deceased are entitled to 50% of the shares that they would have received on intestacy (see Question 28). Therefore, 50% of the estate can be freely distributed. The children’s statutory shares take effect as claims against their deceased parent’s estate. The children can recover their claims from estate assets. If these are insufficient to recover the entire claim, the children can recover their claims from the gifts that were made by the deceased:

  • Within five years preceding his death.
  • With the intention of infringing the children’s statutory rights.

The children can recover their assets from trust assets, if the trust settlement is considered a donation by the deceased.

Children can collect their statutory share six months after the parent’s death. However, the parent’s will may contain a provision that the children can only claim their statutory share after the death of the:

  • Surviving spouse or registered partner.
  • Life partner with whom the parent entered into a notarial cohabitation agreement.

A disinherited spouse or registered partner has a number of statutory rights. For example, he or she can claim:

  • The use of (usufruct) the family home and household effects.
  • The use of other estate assets if he or she, when considering all circumstances, needs this for maintenance.

25. What are the main characteristics of the forced heirship regime, if any, in your jurisdiction?

Avoiding the regime

Children have statutory shares only in the estate of their deceased parent. Therefore, for example, if the deceased was married and the community of property regime applies, the children are entitled to half of the total property of the deceased and his spouse (see Question 37).

Entering into a community of property, either by marriage or as a result of the amendment of marriage conditions during the marriage, is not regarded as a gift that needs to be taken into consideration in determining the statutory share.

Assets received by beneficiaries in other jurisdictions

The regime takes into account the estate’s worldwide assets.

Mandatory or variable

The testator can stipulate in his will that the children can only claim their statutory shares after:

  • The death of the surviving spouse or registered partner.
  • The death of the life partner (provided that the testator and life partner made a notarial cohabitation agreement).
The children have no authority in the distribution of the estate as they are only creditors of the estate and not forced heirs. However, their claims cannot be excluded by the will.

Real estate or other assets owned by foreign nationals

26. Are real estate or other assets owned by a foreign national subject to your succession laws or the laws of the foreign national’s original country?

Under Dutch conflict of law rules, the succession laws of the state of the testator’s last residence will apply if:

  • The testator was a citizen of that state.
  • The testator was not a citizen of the state of his last residence, but resided in that state for at least five years immediately before his death.

Under the unity system, no distinction is made in the legal treatment of movable and immovable property.

Under Dutch conflict of law rules, a choice of law clause is valid in the will. Therefore, a testator can specify whether Dutch succession laws or the succession laws of the country of his origin apply. The formalities for a valid choice of law clause are the same as for a will made in another jurisdiction (see Question 18).

27. Do your courts apply the doctrine of renvoi in relation to succession to immovable property?

Generally, Dutch courts do not accept this type of reference. Succession law does not distinguish between movable and immovable property (see Question 26).


28. What different succession rules, if any, apply to the intestate?

If there is no will, the intestacy rules apply. These provide that the deceased’s spouse (or registered partner) and children inherit equal shares in the estate. However, the children do not immediately receive this share. Rather, the deceased’s spouse (or registered partner) receives, by right, all assets of the estate and must discharge all liabilities (statutory division (wettelijke verdeling)).

The children receive a claim for the value of their share. However, this claim can only be made after:

  • The death of the spouse or registered partner.
  • Another event stipulated in the deceased’s will (such as remarriage (see Question 25)).

The children’s claims bear interest if the statutory interest rate (an interest rate in non-commercial matters that is periodically determined by the government) is higher than 6%. From 1 July 2012 the statutory interest is 3%. The deceased can provide for a different interest rate in his will. In addition, the deceased’s heirs can agree a different rate of interest between themselves (see Question 17).

Cohabitants are not entitled to a share of the deceased’s estate, in the absence of a will.

If a child dies before his parent, that child’s descendants are entitled to his share of his parent’s estate. If there are no descendants, the living brothers and sisters of the deceased child inherit his portion of his parent’s estate.

29. Is it possible for beneficiaries to challenge the adequacy of their provision under the intestacy rules?

Children, step-children and grandchildren are entitled to claim a reasonable compensation from the estate for labour performed in the household or business of the testator during their majority.

Children step-children and the surviving spouse or registered partner are entitled to claim the transfer from the estate of assets instrumental to the testator’s business that they will continue. The transfer is subject to a reasonable compensation of the estate. This provision also applies to shares in a holding company.


30. Are trusts (or an alternative structure) recognised in your jurisdiction?

Type of trust and taxation

The Netherlands does not have trust law. However, it is party to the HCCH Convention on the Law Applicable to Trusts and on their Recognition 1985 (Hague Trusts Convention).

Dutch tax law contains specific regulations for trusts (and trust like entities). The regulations apply to irrevocable discretionary trusts that have a more than secondary private purpose and therefore do not apply to charitable trusts. For Dutch income tax purposes, trust assets are attributed to the settlor during his lifetime. On his death, the assets are attributed to his heirs, according to their portion in the estate. This attribution is a deemed acquisition for inheritance tax purposes. If an heir can prove that he will not acquire assets from the trust, the trust assets will be attributed to the other heirs (if any) instead. In the absence of heirs, the trust assets will be attributed to the beneficiaries of the trust.

Any distributions of trust assets during the lifetime of the settlor are considered to be donations. Given the system of attribution, the discretionary settlement of assets into the trust is not considered a taxable gift. The attribution rules do not apply for personal income tax purposes (however, they do apply for inheritance and gift tax) if the trust’s income is taxed (abroad or in the Netherlands) at a rate of at least 10%, to be determined by Dutch standards.

31. Does your jurisdiction recognise trusts that are governed by another jurisdiction’s laws and are created for foreign persons?

The Netherlands is party to the Hague Trusts Convention and recognises trusts governed by another jurisdiction’s laws, if they were created according to the rules of the Convention.

32. What are the tax consequences of trustees (for example, of an English trust) becoming resident in/leaving your jurisdiction?

A trust established outside The Netherlands may be subject to Dutch corporate income tax if it runs an enterprise in The Netherlands or owns a substantial (5% or greater) shareholding in a Dutch corporate body.

Although it is not possible to establish a trust in The Netherlands, it is possible to import one. If a trust became established in The Netherlands, it is likely that no Dutch corporate income tax liability would exist. Therefore, the residence of a trustee may be relevant to establish the Dutch corporate income tax liability of a trust.

33. If your jurisdiction has its own trust law:
• Does the law provide specifically for the creation of non-charitable purpose trusts?
• Does the law restrict the perpetuity period within which gifts in trusts must vest, or the period during which income may be accumulated?
• Can the trust document restrict the beneficiaries’ rights to information about the trust?

There is no trust law in The Netherlands (see Question 30).

34. Does the law in your jurisdiction recognise claims against trust assets by the spouse/civil partner of a settlor or beneficiary on the dissolution of the marriage/partnership?

A foreign trust is recognised in The Netherlands (see Question 31) and governed by the applicable law, as elected by the settlor. If no applicable law has been chosen, a trust must be governed by the law with which it has the closest connection.

If a trust settlement is to be considered a donation, or involves the family residence, the settlor’s spouse must approve the settlement. A lack of approval makes the settlement reversible.

35. To what extent does the law of your jurisdiction allow trusts to be used to shelter assets from the creditors of a settlor or beneficiary?

A creditor or a bankruptcy curator (that is, someone appointed to take over a bankrupt’s assets) can reverse the debtor’s acts, including a trust settlement, in breach of the creditors’ rights (actio Pauliana). A creditor (or a curator) can also claim that in the circumstances of the case, the trust settlement is a tort (onrechtmatige daad) against the settlor’s creditors.

Ownership and familial relationships

36. What are the laws regarding co-ownership and how do they impact on taxes, succession and estate administration?

Co-ownership is allowed between spouses, family members and non-relatives. The co-owners jointly administer the property, unless agreed otherwise. Co-owners must act according to principles of reason and fairness. The Civil Code contains a number of general rules regarding co-ownership, including division of the property by the District Court if the co-owners cannot agree the terms of division.

Division of the co-owned immovable property is subject to registration tax (see Question 11) unless the division is between:

  • Spouses.

Cohabitants that have ended their relationship.

37. What matrimonial regimes in trust or succession law exist in your jurisdiction? Are the rights of cohabitees/civil partners in real estate or other assets protected by law?

Community of property

If a couple marries without a contract setting out marriage conditions (see below, Marriage Conditions), the couple automatically falls under the community of property regime. This regime covers all property, including:

  • Property acquired before marriage.
  • Property acquired by inheritance, legacy or donation.

In very exceptional cases, certain assets can be excluded from the regime if they are so closely connected to one spouse that they do not form part of the community of property (for example, compensation for disability resulting from a car accident). A testator or donor can also provide, under an exclusion clause, that an inheritance portion, legacy or donation is the heir’s, legatee’s or donee’s private property and therefore will not be part of the community of property.

Community of property is automatically dissolved on one of the couple’s death. Unless otherwise agreed, all property is divided equally.

Marriage conditions

Spouses can agree on marriage conditions before marriage. Marriage conditions must be incorporated in a notarial deed. During the marriage, a marriage contract can be made or amended. The spouses can freely negotiate marriage conditions and can, among other things:

  • Exclude any or some of the property from the community of property regime.
  • Insert a periodical settlement clause regarding the income that remains after the household expenses are paid.
  • Agree on a final settlement clause, according to which, at the end of the marriage by divorce and/or death, property is administered as if the spouses were subject to full community of property. The Civil Code contains general rules regarding settlement clauses in marriage conditions.

Civil partners

A registered civil partnership (geregistreerd partnerschap) enjoys the same legal treatment as marriage for the purposes of property law.


There are no special provisions in family law in relation to cohabitants. The general rules of co-ownership apply (see Question 36). In practice, it is advisable for cohabitants to make a notarial cohabitation agreement to regulate their property rights.

A will can provide that the testator’s children can only claim their statutory share after the testator’s life partner’s death, provided the testator and the testator’s life partner entered into a notarial cohabitation agreement (see Question 25).

38. Is there a form of recognised relationship for same-sex couples and how are they treated for tax and succession purposes?

Same-sex couples can enter into a registered civil partnership or marriage. In relation to property law, succession law and tax law, same-sex couples are treated in exactly the same way as heterosexual couples.

39. How are the following terms defined in law:
• Married?
• Divorced?
• Adopted?
• Legitimate?
• Civil partnership?


Marriage means the execution of a marriage contract before a civil servant, including for same-sex couples. Civil marriage must be entered into before a religious wedding.


Divorce is a marriage terminated by a court decision.


Adopted children are treated as equal to blood relations and lose their succession rights in relation to their biological parents. An adoption by stepparents is a specific form of adoption. Same sex couples can adopt children.


A legitimate child is born in wedlock. However, the law does not distinguish between legitimate and illegitimate descendants.

Civil partnership

This is a partnership that is registered at the Register Office. In relation to property matters, a civil partnership has identical legal consequences as a marriage.

40. What rules apply during the period when an heir is a minor? Can a minor own assets and who can deal with those assets on the minor’s behalf?

Children are legally represented by their parents or a guardian during their minority (that is, until the age of 18 years). The parents (or a guardian) need a sub-district court’s authorisation for certain legal acts (listed in the Civil Code) that significantly affect the minor’s property, such as donations on behalf of the minor.

A minor can own assets. These assets are managed by the administrator of the assets, generally the minor’s parents or guardian. In a will, a testator can appoint someone other than the minor’s parent or guardian as administrator of the assets acquired from the estate.

Capacity and power of attorney

41. What procedures apply when a person loses capacity? Does your jurisdiction recognise powers of attorney (or their equivalent) made under the law of other jurisdictions?

If a person is put under legal restraint (curatele) by a sub-district court, the court appoints a legal guardian (curator bonis) to represent him. A sub-district court can impose an administrator for the adult’s property if the adult cannot administer his own property. The administrator manages the property.

A power of attorney, given before the loss of capacity, remains valid. Foreign powers of attorney are normally recognised, but a notarial power of attorney is required for certain legal acts, such as providing a mortgage over Dutch immovable property.

Proposals for reform

42. Are there any proposals to reform private client law in your jurisdiction?

There are no proposals to reform private client law in The Netherlands.

However, the Regulation (EU) No 650/2012 on jurisdiction, applicable law, recognition and enforcement of decisions and acceptance and enforcement of authentic instruments in matters of succession and on the creation of a European Certificate of Succession will be effective from 1 August 2012, and will apply to the Netherlands. This Regulation provides for uniform European international private law regarding successions.

The district court decision regarding the business succession facilities (see Question 8) may have important consequences. However this depends among other things on the outcome of the appeal that has been lodged in this case.

Private clients should also carefully follow the changes to the mortgage interest deduction that have been announced in the Coalition Agreement of 29 October 2012 (see Question 6).

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