The percentages of tax interest have been substantial in recent years:
- up to 7.5% for income tax and inheritance tax, among other things
- up to 10% for corporate income tax
Proceedings before the Supreme Court
On 7 November 2024, the District Court of the North Nederland ruled that a tax interest rate of 8% on an assessment from 2021 is unreasonably high. This ruling is important for companies that have had to pay tax interest on the corporate income tax assessment in recent years.
If you submit a timely request for a reduction of the tax interest, you may be able to benefit if the Supreme Court also finds that the tax interest is too high.
The State Secretary has lodged an appeal in cassation against the judgment. As a result, the Supreme Court must now rule on this issue. Before the Supreme Court decides, the Advocate General gives an opinion. In this advice Koopman states that the regulator has exceeded its competence in increasing the tax interest rate to 8% for corporate income tax as of 1 January 2022.
Even if the regulator has remained within its competence, the Advocate General believes that too little account has been taken of the principle of administrative law regarding sound reasoning and proportionality. The conclusion is that the court ruled correctly.
Tip: Take action in time for a reduction in tax interest! See also our earlier post on how tax interest is calculated, when it is imposed and the mass objection procedure.
What does this advice mean for the rate?
It is up to the Supreme Court to determine whether the increase to 8% for corporate income tax may remain. This may also have consequences for the years 2023, 2024 and 2025 or for split financial years.
According to the Advocate General, a reasonable outcome is to use the statutory (non-commercial) interest of Section 6:119 of the Dutch Civil Code when calculating tax interest. This rate applied before 2014, before budgetary motives and behavioural influence determined the interest rate.
Overview of interest rates
Below is an overview of the statutory interest and commercial interest over the years:
| Period |
Statutory commercial interest |
Statutory (non-commercial) interest |
|
From 01/07/2025
|
10,15%
|
6%
|
|
1-1-2025 to 30-6-2025
|
11,15%
|
6%
|
|
01/07/2024 to 31/12/2024
|
12,25%
|
7%
|
|
1/1/2024 to 6/30/2024
|
12,5%
|
7%
|
|
01/07/2023 to 31/12/2023
|
12%
|
6%
|
|
1-1-2023 to 30-6-2023
|
10,5%
|
4%
|
|
01/07/2016 to 31/12/2022
|
8%
|
2%
|
|
1-1-2015 to 30-6-2016
|
8,05%
|
2%
|
|
01/07/2014 to 31/12/2014
|
8,15%
|
3%
|
|
1-1-2014 to 30-6-2014
|
8,25%
|
3%
|
|
1-7-2013 to 31-12-2013
|
8,5%
|
3%
|
|
1-1-2013 to 30-6-2013
|
7,75%
|
3%
|
The Supreme Court must rule and provide clarity. Not only for this case, but also for all mass objection procedures. There are many things waiting for a decision on the right interest rate. This applies to corporate income tax, but also to other taxes.
Limit or prevent tax interest?
The Tax and Customs Administration does not charge tax interest if you file your income or corporation tax return on time and the assessment is determined without changes (in accordance with the tax return).
You can also limit or prevent tax interest by applying for a provisional assessment on time. In this you enter the expected profit or income for the current year. The Tax and Customs Administration usually imposes a (revised) provisional assessment within 6 to 8 weeks.
If your estimate is correct or even on the high side? Then you do not pay tax interest. Is the provisional assessment lower than the final profit? Then you pay tax interest on the difference.
Tip: apply for an (extra) provisional assessment in time!
Are you expecting a discussion and do you want to avoid paying unnecessary tax interest? Then apply for an (extra) provisional assessment in time for the amount you expect to be discussed.
Do you need advice on tax returns and assessments? Our advisors are ready to help you!
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