As per 1 January 2018 a dividend withholding tax has become effective for Dutch Cooperatives.
The dividend withholding tax becomes applicable to members with a so called qualifying membership rights in Holding Cooperatives which are residents in the Netherlands.
Members have a so called qualifying membership right if they are entitled to at least 5% of the annual profits of the Holding Cooperative or at least 5% of the liquidation proceeds. We speak of a Holding Cooperative if their real activity in the year preceding the year in which the profits are distributed, mainly (for at least 70%) consist of the holding of participations or the direct or indirect financing of certain related parties.
If the above conditions are not met, the dividend withholding tax for Cooperatives will not be applicable. The dividend withholding tax will also not be applicable based on the newly introduced widened withholding tax exemption at source. See our related article in this matter.
Should you have questions on the above or otherwise, please do contact us at fariq@columbusadvisory.com or 0031621486808