Dutch resident subject to contributions in respect of Belgian invalidity benefit | Deloitte


Dutch resident subject to contributions in respect of Belgian invalidity benefit

A Dutch resident receives a Belgian invalidity benefit. Dutch national insurance contributions must be paid over this benefit.

8 March 2017

Dutch version

Belgian benefit

A Dutch resident received a Belgian invalidity benefit but he did not work in 2011. He did not pay Dutch national insurance or Healthcare Insurance Act contributions over this benefit. His position is that he has paid contributions in Belgium over the benefit as from 1996. Hence, he is not liable for Dutch contributions.

Dutch legislation applies

The Den Bosch Court of Appeal confirms the Zeeland-West-Brabant District Court’s judgment that under the European Coordination Regulation (Regulation 883/2004) this person is solely subject to Dutch social security legislation. Because he lives in the Netherlands, performs no work here and receives a benefit from Belgium, he meets the criterion on persons moving within the Community. Hence, a situation in which Dutch social security legislation applies. This makes the interested party subject to contributions over his worldwide income.

No exemption

The Dutch “Access to National Insurance (Additional Categories of Persons) Decree” contains a provision, though, under which Dutch residents who receive a foreign social security benefit may apply for an exemption from Dutch contributions under the General Old Age Pensions Act and the Surviving Dependants Act. The exemption is only granted if the foreign benefit is at least 70% of the Dutch minimum wage.

Following his request, the interested party in this case had been granted exemption as from September 11, 2012. The Social Insurance Bank has rejected his request to give retroactive effect to this exemption. The interested party did not use any legal remedies against this rejection, so the tax proceedings should assume that the Social Insurance Bank’s decision is correct. All this has led to the interested party indeed having to pay Dutch national insurance contributions over 2011.

The request for deduction of the contributions paid abroad was rejected, too, if only because it was legally ascertained that the interested party had solely reported the net benefit in his Dutch tax return.

Source: Den Bosch Court of Appeal November 11, 2016, 15/00812, ECLI:NL:GHSHE:2016:5007

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