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Indirect Tax Weekly Digest
Your weekly update on Indirect Tax topics
Read all about the latest developments in the field of Indirect Taxation in the Netherlands, the EU and the UK and globally.
7 October 2021
2022 Tax Plan published on Budget Day
On 21 September 2021, the Dutch government presented the 2022 Tax Plan to the House of Representatives. Relevant for indirect tax are the bills on the main 2022 Tax Plan and the 2022 Miscellaneous Tax Measures.
In the field of VAT an adjustment in respect of processing negative VAT declarations is proposed. If the VAT declaration is negative for a certain tax period after a correction (for example, if goods are returned), as a result of which the VAT entrepreneur is entitled to obtain a refund of Dutch VAT this refund automatically qualifies as a formal request for a tax refund.
With regard to the Real Estate Transfer Tax (RETT) the following three measures are included in the Tax Plan:
- The acquisition of homes with a conditional sale clause will be subject to an exemption, subject to certain conditions instead of 8% RETT;
- The anti-abuse provision in respect of the exemption for first time buyers will be amended (a) preventing circumventing the exemption threshold of EUR 400.000 by splitting up a home and acquiring another part of the same home within one year and (b) taking into account acquisitions due to inheritance law or matrimonial property law and unforeseen circumstances after the acquisition, such as death or divorce.
Most measures will enter into force on 1 January 2022. The bills may be amended during their parliamentary debate.
Relevant for: companies involved in e-commerce, housing corporations and project developers
Contact: Lex Neijtzell de Wilde
State Secretary approves prevention of double taxation when providing food and beverages in a catering facility
In the Netherlands, the VAT incurred on the costs of food and beverages supplied to staff, a business relation or the VAT entrepreneur himself visiting a hospitality or catering facility (e.g. hotel, bar, restaurant) for a short stay is never deductible. In practice, these costs are regularly passed on by one VAT entrepreneur to another, for example a main caterer that outsources part of the catering to a subcontractor, or a hotel that passes on the costs of a room with breakfast to another hotel if a guest is accommodated at the other hotel. Since these entrepreneurs are not allowed to deduct this VAT, double taxation occurs. The State Secretary of Finance approves by decree that an VAT entrepreneur who does not purchase this 'catering service' as an end user, but who passes on the same service to another entrepreneur, is allowed to deduct this VAT under certain conditions from now on. The VAT entrepreneur must state on the invoice to the customer that it concerns the provision of food and beverages for use on the spot as referred to in Article 15, paragraph 5 of the Dutch VAT Act 1968. The approval is valid from 23 September 2021.
Relevant for: companies involved in catering services
Contact: Edith Koster
Cost sharing exemption applicable on secondment of teachers; No further cassation procedure
The Den Hague Court of Appeal ruled the cost sharing exemption to be applicable on the secondment of teachers to schools. According to the Court, teachers are essential for performing educational activities. The secondment of teachers to schools which are part of the cost sharing group can therefore also be considered essential. The Court also considered that distortion of competition is in this case unlikely because commercial employment agencies are unlikely to perform to same services under the same conditions. In view of the case, the State Secretary states in an explanatory note that he agrees with the judgment of the Court of Appeal.
Relevant for: educational institutions considering the application of the cost sharing exemption
Contact: Gerwin Volkerinkp