Dutch Tax Tips: 2012 tax return
If you have already received your tax return form - the Dutch tax authorities usually send them out from mid-January to the end of February - you must submit your income tax return. The same applies if you haven’t received it yet but expect that you have underpaid tax, or expect to receive more than 14 euros back.
Finally, if you moved to or departed from the Netherlands in 2012, and didn’t work during the time you spent here, you have probably paid your taxes so you can request a refund by completing the 2012 income tax return. Note that in this case you are allowed to do so by December 31, 2017 (i.e. within a five-year period).
The "July 1" deadline
Non-resident taxpayers must submit their tax returns before July 1, 2013 and will receive their provisional assessments in the course of the same year. If you submitted your tax return before April 1, 2013, you will receive a provisional income tax assessment for 2012 by July 1, 2013 and possibly a provisional health insurance assessment too.
The provisional assessment states how much tax you have to pay or receive, and is based on the details you provide. As expected, once these details are verified by your tax advisor, you will receive the final assessment for 2012. Your advisor will also check whether you have to pay tax and national insurance in 2013. If so, you will receive a provisional assessment for 2013.
If you didn’t submit your tax return before July 1, you should request a deferral otherwise you may be fined!
Foreign income: in which country is the tax paid?
If you live in the Netherlands you must indicate your income from other countries in your tax return. That includes any source of income such as salaries (from work done in other countries), assets etc.
Resident taxpayer status
If you have lived outside the Netherlands for the entire year but:
› earn income from the Netherlands, and / or
› have assets in the Netherlands
you can choose to be treated as resident taxpayer and thus be taxed as if you have spent the year here. As expected, in this case, you must also declare your non-Dutch income.
How to avoid double taxation
Even though you must declare your non-Dutch income, this doesn’t mean that you will have to pay income tax (on this part of your income) in the Netherlands. Put simply, if the right to levy taxes is assigned to another country (based on international regulations) you are not liable for that tax here.
So, to avoid paying tax twice (or several times) in different countries, you can request a deduction on the amount of tax liable in the Netherlands, the so-called "deduction to avoid double taxation."
Late, incomplete or no submission
If you have received the tax return form but you are late with your submission or you don’t submit at all you are at risk of a fine. Also, if you haven’t received it, but still need to submit, the Dutch tax office will make an estimate of your income, and send you the tax assessment and a fine. Finally, you will receive a fine if you deliberately submit an incomplete or incorrect return.
Nico Koppel is an Expat Service Provider, who specialises in tax advice & accountancy. For more information, please comment below or visit Koppel Tax Consultants.