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Tax for capital gains. Is it applicable in the Netherlands and if so, in which situations?

Question:
 
My understanding is, that in NL there is no capital gains tax for trading shares or other securities (options, futures).
My question: are there any limitations for this regarding the number of traded securities ? With other words: is this also valid for private daytraders trading hundred shares per day ?
 
Answer:
 
In general an individual will not have to pay tax on capital gains. So if the main residence is sold or shares are sold the profit is not taxable. This is different if the transaction(s) exceed(s) normal asset management. In that case the capital gain is treated as income from other activities or even business income.
 
Relevant are:
  • the number of transactions -> the more transactions the sooner it is assumed that activities exceed normal asset management
  • specific knowledge of the individual -> if the individual is a professional trader, the personal transactions will be seen as taxable income sooner than if the individual doesn‘t have specific knowledge or experience.
  • work which is invested in the asset -> if maintenance of a property is taken care of by an external party the activitities may be seen as normal asset management, if the owner does all the maintenance himself and even the renovations the tax authorities will argue that this is no longer normal asset management.

So it depends on the actual facts and circumstances how the capital gain is treated. Even judges do not always decide the same.

If the income is treated as income from other activities or business income then the rent you receive is also taxable. The income then falls in Box 1. The related expenses can be deducted from this income. That is different from taxation in Box 3 where income is seen as an investment. See www.expatax.nl/box-3

If shares concern an interest in a limited company of at least 5%, then this is seen as a substantial interest. Income from substantial interest is taxed in Box 2

 

 

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Comments (10)
Comment by Phil on Tue, Feb 23rd, 2016 at 11:23 AM
Is this still actual?
Comment by Arjan Enneman on Tue, Feb 23rd, 2016 at 11:49 AM
Yes, this article is still actual. There is no indication either that the answer would change in the (near) future.
Comment by Jakob on Tue, Sep 20th, 2016 at 8:28 PM
I have been told from other tax-planning sources within Holland that if you don‘t have other income i.e a regular job, your investment income in box 3 will then be considered your main income and be taxed under box 1 instead, regardless of how small anumber of trades carried out! Any truth to this? Do you actually need to resort to be ex. self-employed (no matter how small the income) just to avoid this? Seems crazy!
Comment by Riccardo on Sat, Feb 25th, 2017 at 7:35 PM
Hi, Hope you can help me to clarify taxation in the Netherlands over capital gains on investment in shares, funds, etc. specifically I am interested to know if there is a difference in tax charges over an investment directly in the Netherlands vs. an investment in a foreign country (I.e Italy) where capital gains are taxed in the Netherlands being a Dutch resident and living in Holland Thanks
Comment by Taras Kozlov on Tue, Apr 18th, 2017 at 2:23 AM
I found different sources have different opinions regarding day trading activities. Some of them claim that even day trading profits falls under box 3 because of the following supreme court ruling: https://uitspraken.rechtspraak.nl/inziendocument?id=ECLI:NL:PHR:2011:BR7011 So how does it work in practice? Has anyone actually paid box 1 taxes from this kind of profit?
Comment by Arjan Enneman on Tue, Jun 20th, 2017 at 2:07 PM
@Riccardo: for the Netherlands it doesn‘t make a difference whether it concerns investments in shares and funds in the Netherlands or in another country. The other country may however have a capital gains tax unlike the Netherlands. The tax treaty will then determine whether the foreign capital gains tax needs to be paid or not.
Comment by Arjan Enneman on Tue, Jun 20th, 2017 at 2:10 PM
@Taras: the more the total of the activities look like a business the sooner the income is taxed in box 1. This is determined case by case and also depends on time involved and the specific knowledge of the person who is trading.
Comment by ihatejam on Wed, Jul 26th, 2017 at 1:11 PM
Would this apply to me? I am a Brit employed in NL by a company with a Brit HQ. I have been in NL for 6 years. I participate in our company‘s Sharesave scheme (FTSE listed stock). When the contract matures am I liable for capital gains tax here in NL or in the UK? And am I liable for income tax? (I am not a professional trader)
Comment by Nov Jakolic on Mon, Aug 7th, 2017 at 7:56 PM
Dear Arjan, First of all congrats for your website, it seems so professional and useful. I understand from the above that trading in cryptocurrencies (like bitcoin), by performing many transactions per month like 30 per month, by an experienced person in this kind of trading with the intention to maximize profit/wealth, it is taxed under the normal tax rates of 52% above the EUR67,072 for an individual or 25% above EUR200k for companies. Is my understanding correct? Regards,
Comment by Arjan Enneman on Thu, Aug 10th, 2017 at 6:28 PM
A participation in a company sharesave scheme is in principle taxed in the payroll administration. Capital gains tax is not applicable. Not in the Netherlands.
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