Restriction on Interest Deductibility for Dutch Holding Companies

Journal
Vis, N.
Netherlands
European Taxation 2013 (Volume 53), No. 6
FormatPDF
EUR
40
| USD
45
(VAT excl.)

As per 1 January 2013, new legislation restricts the deductibility of interest on excessive debt used to finance participations. An intention test has been introduced that addresses situations in which the acquisition of a participation is structured via a Dutch taxpayer for the purpose of obtaining an interest deduction in the Netherlands. This note discusses the intention test, in particular the circumstances under which a Dutch holding company can meet this test.