Withholding tax

Tax on income imposed at source, i.e. a third party is charged with the task of deducting the tax from certain kinds of payments and remitting that amount to the government. Withholding taxes are found in practically all tax systems and are widely used in respect of dividends, interest, royalties and similar tax payments. The rates of withholding tax are frequently reduced by tax treaties.

The Netherlands has a withholding tax on dividends. Since 2021, Dutch tax law also provides for a conditional withholding tax on interest and royalties paid to related companies in low-tax jurisdictions, and since 2024 that conditional tax also applies to dividends paid to such companies.