Curaçao: Double Tax Treaties
Netherlands Tax Treaty
The Netherlands Tax Treaty (Belastingregeling voor het Koninkrijk, or BRK or TAK) applies to the three constituent parts of the Kingdom of the Netherlands, being Holland itself, Aruba and the Netherlands Antilles.
Prior to 2002, the BRK was last amended in 1997 and included the following provisions:
- there is no withholding tax on interest and royalty payments by Netherlands companies;
- the Dutch withholding tax on dividends paid to Antillean companies is 15%; but if the Antillean company owns 25% or more of the Dutch paying company, the rate is reduced to 7.5% (5% if the Antillean company accepts some local taxation).
The New Fiscal Framework (NFF) came into force alongside a further revision of the BRK on January 1, 2002. Under the amendments and for the time being, the proposed Netherlands Antilles dividend withholding tax of 10% will not enter into force.
Futhermore, the dividend article in the current BRK has been amended so that dividends from a Dutch corporation to Netherlands Antilles corporate shareholders, owning at least 25% of the shares in the Dutch corporation, are exempted from dividend withholding tax provided that the dividend is subject to Netherlands Antilles tax at a rate of at least 8.3%.
The Dutch corporation has to withhold 8.3% dividend withholding tax (at the time of writing) from the gross dividend. The 8.3% which has been withheld upon the dividend distribution in the Netherlands can be credited against tax in the Netherlands Antilles.
Dividends and capital gains derived from shareholdings in a Netherlands corporation are fully exempted from profit tax in the Netherlands Antilles provided that the shareholding amounts to at least 25% and that the dividend is subject to the Netherlands Antilles tax of at least 8.3% on the gross amount of dividends received.
Dividends paid by Dutch corporations to Netherlands Antilles corporations which don't qualify under the participation exemption are subject to Dutch dividend withholding tax. Netherlands Antilles offshore corporations may elect for the new dividend article.