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Belgium – Netherlands Double Tax Treaty

Belgium – Netherlands Double Tax Treaty

When a resident of Netherlands or Belgium gains income in the other of the two countries, he might be taxed in Belgium but also in Netherlands. In order to avoid such situations the Belgium – Netherlands Double Tax Treaty has been signed. The convention regulates as well the taxation and the compensations in case of double residency.

Provisions of the Belgium – Netherlands Double Tax Treaty

The tax convention between Belgium and Netherlands specifies that a person who has revenues from the Netherlands has the right to apply for tax relief or alternatively choose to become a Dutch-resident taxpayer. The double tax relief is going to be calculated taking in consideration the country where you have obtained your income and the type of the revenue. Usually the taxes from work and home wages are calculated by the exemption method which reliefs you from the taxes in the country of residency and allows you to pay in the other country the proportional amount due for the income obtained there.

Another method of tax relief is the setoff method which compares and recalculates your tax amount in the country of residency and which usually applies to dividends, royalties and interest. Our experts in company formation in Belgium can offer detailed legal advice on how to make use of the Belgium – Netherlands Double Tax Treaty’s regulations.

Advantages of the Belgium – Netherlands double tax treaty

The tax convention between Belgium and Netherlands is an important instrument in increasing economic cooperation between the two countries. It is as well a measure to prevent tax avoidance and to increase transparency and safety in the economic environment. 

The treaty prevents double taxation of companies and natural persons when taxes such as the individual income tax, corporate tax, dividend tax and other taxes on legal entities are applied to their revenues.

Following the provisions of the Belgium – Netherlands double tax treaty the economic agents will know exactly where and how much they are taxed for their business profits, for gains from immovable property, shipping and air transport activities, dividends, interest, royalties and other capital gains.

Don’t hesitate to contact our specialists in company formation in Belgium who can provide advice in taxation matters so that you can profit of the advantageous provisions of the double taxation treaty between Belgium and Netherlands