18/July/2025

Tax Newsflash | Dutch Supreme Court confirms narrow scope dividend withholding exemption

Today, the Supreme Court ruled in two key cases (ECLI:NL:HR:2025:1162 & 1163) that Belgian holding companies were not entitled to the Dutch dividend withholding exemption under Article 4(2) of the 1965 Act, due to abuse of law.
Background: The Belgian companies held substantial stakes in Dutch feeder entities for private equity investments, but lacked staff, local presence, or involvement.

Key findings:

• The structures were deemed partially artificial and tax-driven;
• The exemption was rightfully denied under Article 4(3)(c);
• Economic reality and genuine business reasons are essential.

Implications:

• Anti-abuse provisions may apply even where structures have existed for many years;
• Intermediate holdings without involvement face a high bar for exemption
• Taxpayers should be prepared to demonstrate substance and purpose beyond formal ownership.

These judgments raise the bar for foreign holding companies claiming dividend exemptions in the Netherlands.

Full rulings:

https://uitspraken.rechtspraak.nl/details?id=ECLI:NL:HR:2025:1162&showbutton=true&idx=27
https://uitspraken.rechtspraak.nl/details?id=ECLI:NL:HR:2025:1163&showbutton=true&idx=25