The Upper House passed the tax stimulus package bill on June 30, 2009. In addition to the tax stimulus measures, this act regulates a number of other measures that include a substantial increase in the tax offense penalty relating to hidden income from savings and investments and a curtailment of the voluntary disclosure rules. The restriction of the voluntary disclosure rules will be effective from January 1, 2010. The higher penalties on hidden income from savings and investments can be imposed from July 2, 2009.
300% penalty
Under tax law, penalties can be imposed with regard to personal income tax, inter alia, if a taxpayer deliberately submits a tax return that is too low or when an insufficient levy of tax is imputable to gross negligence or intent. These penalties can reach a maximum of 100% of the unpaid or underpaid tax. The statutory amendment enables for the imposition of a maximum penalty of 300% of the underpaid tax solely on income from savings and investments (Box 3). The policy rules allow for the imposition of a 100% penalty on underpaid tax only if there are aggravating circumstances such as repeat offenses. These rules also apply to the 300% penalty. This amendment applies to income from savings and investments both in the Netherlands and abroad. The rules must be viewed within the framework of the Dutch Revenue’s hunt for unreported foreign assets.
Voluntary Disclosure Rules
Taxpayers wishing to declare any wrongfully unreported income to the Dutch Revenue (such as bank accounts abroad) can currently avail themselves of the voluntary disclosure rules. Taxpayers who provide full disclosure of their affairs before they could reasonably suspect that the Dutch Revenue or the FIOD/ECD may be investigating them, must, of course, pay all of the tax owed with interest, but the voluntary disclosure rules mean that no penalty will be imposed.
The amendment to the voluntary disclosure rules that was passed on June 30, 2009, means that a taxpayer has two years after submitting an incomplete or incorrect tax return to voluntarily correct that tax return without being subject to a penalty. This amendment will enter into effect on January 1, 2010. Voluntary disclosure without being liable to a penalty will not be possible once the two-year deadline has passed. The penalty amount after January 1, 2010, for a voluntary disclosure after the two-year deadline is not yet known. The Lower House has discussed a 15% penalty, but there is no certainty as to whether the penalty will be limited to this level. In conclusion, it remains advisable to have a KPMG Meijburg & Co specialist assist you in availing yourself of the voluntary disclosure rules.