Netherlands To Renew Tax Treaty Talks With China

by Ulrika Lomas, Tax-News.com, Brussels

17 September 2007

It is expected that the Netherlands will resume negotiations with China in mid-December 2007 in order to arrive at a new general tax treaty, the Dutch Ministry of Finance has announced.

The Finance Ministry is urging interested parties that wish to draw its attention to matters that are important to them with regard to (double) taxation in connection with China to make submissions no later than November 1, 2007.

The current Netherlands/China tax treaty applies withholding tax at 10% on dividends and 0% on interest and royalties on payments made by a Netherlands company.

The Netherlands has a wide network of double taxation avoidance treaties, and has concluded treaties with most industrialised countries and many developing countries. It also has conventions for avoiding double taxation on estates and inheritances with Finland, Israel, Sweden, Switzerland, the UK and the US.

Individuals resident in the Netherlands are subject to income tax on their worldwide income. Companies established in the Netherlands are subject to corporate income tax on their worldwide profits. In addition, natural persons who do not live in the Netherlands are subject to income tax on income from a number of sources in the Netherlands. These non-resident income tax payers subject to income tax may still opt to be treated as resident taxpayers. Companies resident outside the Netherlands are subject to corporate income tax on their taxable profits from certain sources in the Netherlands.

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