Dutch tax classification rules: proposed changes to funds for joint account

In spring 2021, the Dutch government proposed to overhaul the Dutch tax classification rules for Dutch and foreign entities, such as partnerships, with the aim to align these rules with international standards. See our newsletter of 30 March 2021. Following public debate and input from stakeholders around this topic, it has recently been announced that two separate bills of law to change the Dutch tax classification rules will be submitted during the 2023 Dutch Budget Day. On the one hand, a bill to change the general tax classification rules and on the other hand this separate, now being consulted, bill to change the Dutch tax classification rules for FGRs as these rules are closely connected to the tax investment regimes that are dealt with in this proposal.

Proposed changes to the Dutch FBI regime

On 20 September 2022, the Dutch government announced its intention to disallow an entity applying FBI status to directly invest in real estate (i.e., the Dutch REIT-regime). The initial date of entry into force,1 January 2024, was later postponed to 1 January 2025. On 8 March 2023, the draft bill of law was published for consultation, providing more details on the proposed measures, including the alleviating measures in relation to RETT.

Concluding remarks

The proposed amendments to the FGR and FBI may have major consequences to existing investment structures. Loyens & Loeff can assist you with performing an impact assessment. With those conclusions in mind restructuring alternatives should be investigated and already explored with the principal stakeholders.