Newsletter November 2003

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Expatax, Newsletter November 18, 2003

The world changes every day. As an expat you will be used to this. Rules change and websites change. Recently my article about the changes in the Dutch system for 2004 ('Miljoenennota') was published on Expatica (and on Elynx plus ExpatFocus). Some rules have been changed again and so has Expatica's website. One of the major changes concerns the discussion forum. We will discuss the new rules and our discussion forum plus other relevant subjects.

SDU, our software supplier, has told us that for 2003 the tax software should be available at the end of December. This means that we should be able to start working on tax returns for our clients already in January instead of February as usual. This gives us more time to complete tax returns before April 1. Clients who have subscribed to our Tax Service will be assisted first. Other clients will be assisted after that so the earlier we have all the necessary documents and information the earlier your tax return will be completed. The client questionnaire for 2003 is already available online. As of 1 November we also have an office in Utrecht (west side) available. This makes it much easier for clients in that area or in Amsterdam to make an appointment in one of our offices. The address will be mentioned on our website.

For more information: www.expatax.nl/taxreturn.htm

In this newsletter:

1. New rules in 2004
2. Our discussion forum
3. Provisional refund 2004 (request)
4. The end of the WAZ (disability insurance for entrepreneurs) in 2004
5. Retirement
6. Ziekenfondsgrenzen
7. New rules concerning invoices
8. T form
9. Unsubscribe

1. New rules in 2004

On 13 November our parliament has made some new adjustments to the new rules for 2004. Below we will mention the most relevant adjustments for you.

- Employers get the possibility to give their employees a gift (not money) once a year against a reduced tax rate. The ruling sees for example on 'Sint Nicolaas' gifts and Christmasgifts. The tax for the employer is maximum 15% on a gift of maximum € 35.

- The tax free travel allowance for business kilometres (including kilometres between home and work) with your own car (plus bicycle and motor) will be raised from € 0,17 to € 0,18.

- The fictitious income from a company car will be calculated at 22% of the cataloguevalue of the car instead of 20%. If you can prove that you drove less then 500 private kilometres (based on a full year) then no fictitious income will be taxed.

To finance the changes the tax free amount of the PC ruling will be reduced to € 1.415. This means that as of 2004 an employee can receive a tax free pc (once every 3 years) for a maximum price of € 1.415. This used to be € 2.269. Other reason for the change is that the government means that computers have become much cheaper during the last years.

2. Our discussion forum

No longer online.

3. Provisional refund 2004

If you incurred deductible expenditure or are entitled to tax credits in respect of 2004, you can request the tax office to grant you a provisional refund. Which types of deductible expenditure and tax credits will entitle you to a provisional refund depends on your situation. One of the reasons could be the interest you pay on your mortgage or the personal tax credit for a non earning partner.

Our software has been updated on November 17. Please contact us when you would like to request a provisional refund. If the request is filed before December 1 the taxoffice will start paying the refund in January 2004.

Look here for more information: www.expatax.nl/provisionalrefund.htm

4. The end of the WAZ in 2004

As of January 1 the premiums for the WAZ will be reduced to zero. As of July 1 2004 the WAZ will be cancelled totally. The WAZ is an obligated disability insurance for entrepreneurs. It insures a minimum income in case of disability. The premiums for the disability insurance are deductible in the year the premiums are paid. So if you received an assessment and you paid it please forward it to us or notify us about the payment so we can deduct it in your tax return.

5. Retirement

With the economy going down and raising uncertainty about the future it's important that you think about your own personal situation. You may have a well paid job at the moment. Make sure that you keep this income as much as possible in case something happens. Our consultant Richard Veal is fully qualified to advise you about the right decisions. There are several risks which he can help you to minimize.

- retirement: do you have enough income available when you retire? By saving right now at the moment that the money is available you can create your own future income. Because of the costs involved we believe that an offshore retirement fund is a better solution than a Dutch pension or insurance.

- early death: do your relatives have enough income when you die early? If you have children it's important that they can be supported by your partner. Your partner may not have enough income to do this.

- disability/unemployment: are you sure you can pay of your mortgage if you become unemployed or disabled?

These are just a few questions. Not only the tax side is important when you live in the Netherlands but also the other financial matters. Living in another country will lead to other rules and also to changes in your pension. As your advisor we believe it's important to point you at this.

6. Ziekenfondsgrenzen

The new borders for the Ziekenfonds have been announced. You will have Ziekenfondsinsurance if your earnings are below the following amounts:

Employee: € 32.600
Entrepreneur: € 20.800

The amount for employees is based on the taxable income which is the salary excluding the 30% ruling.

7. New rules concerning invoices

Within the EU new rules have been announced as of January 1 2004 concerning invoices which need to be sent by entrepreneurs. Below you will find more information about the statements which are required for VAT purposes on invoices:

· date of issue;
· a specific number;
· where necessary, the VAT identification number of the taxable person and his customer;
· full name and address of the taxable person and his customer;
· description of the goods or services;
· quantity of goods supplied or, if necessary, of services rendered;
· date of supply of goods or rendering of services;
· place of supply of goods or rendering of services;
· taxable amount per rate;
· VAT rate;
· VAT amount payable;
· total amount payable;
· where an exemption is involved, reference to the provision which justifies the exemption;

and in exceptional cases:

· where the supply of new means of transport is involved, the particulars specified in Article 28a(2);
· where the margin scheme is applied, reference to Article 26 or 26a;
· where the provisions of Article 28c(E)(3) are applied, an explicit reference to that provision as well as the identification number for value added tax purposes under which the taxable person has carried out the intra-Community acquisition and the subsequent supply of goods and the number by which the person to whom this supply is made is identified for value added tax purposes.

More information can be found on: www.expatax.nl/regulationsinvoice.htm

8. T form

On December 31 2003 the 3 year term ends for which you can file a T form to request a refund for the year 2000. Only if the refund will be higher than € 454 this term can be extended to 5 years. In that case you can still request a refund for the year 1998.

9. Unsubscribe

This newsletter is sent to all the persons who have contacted us in the past, are clients or have subscribed to the mailinglist. If you don't want to receive anything from us anymore just reply to this email and mention that you would like to unsubscribe from future mailings. We will then delete your emailaddress from our systems.

If you have any questions about the above you can always contact me. Feel free to forward this newsletter to other persons who you believe may be interested in receiving it. They can subscribe to our mailinglist on http://www.expatax.nl/newsletter.htm.

Kind regards,

Arjan Enneman
www.expatax.nl