What a new year will bring is a surprise every time. But one thing is almost certain. The year 2021 will undoubtedly be dominated by vaccination, which will hopefully allow us, gradually, to return to normal life. At least, the life we were used to, about a year ago.
Just like every year, there are many changes in laws and regulations. In that regard, it doesn't get any easier. Apart from changes in rates and bases, new regulations have entered into force.
One eye-catching measure, for example, is the approach to tax avoidance. For example, the withholding tax on interest and royalties comes into effect. With this 25% withholding tax, payments to countries that levy no or too little tax are taxed by the Netherlands and the flow through our country is also prevented. As of 1 January 2021, intermediaries such as tax advisers, accountants and financial institutions are obliged to report cross-border arrangements that can be used to avoid tax to the tax authorities. These are tax arrangements involving residents of different countries that could potentially be used to avoid tax.
For example, a new incentive has been created to invest. The government wants to encourage companies to invest with a new investment discount, the Job-related Investment Discount (BIK = Baangerelateerde Investeringskorting). This temporary arrangement is intended to ensure that companies continue to invest in, for example, new machines. The scheme applies to investments in 2021 or 2022. For large investments in a year, the discount up to € 5 million is 3.9%, above 1.8%.
The entry in the so-called UBO register (Ultimate Beneficial Owner) is already in effect from 27 September 2020. Companies are obliged to register their owners, or the persons who have control, in the UBO register. This is due to European rules. The aim of the register is to combat financial and economic crime, such as money laundering.
In short ..... There is a lot to do again.
I wish you a very good new year
Wijnand van Pelt
January 1, 2021