Advantages of a Dutch CV
We are now advising a group of non-Dutch residents that invested in a modest real estate portfolio in Amsterdam. They invested via a limited partnership, a so-called Commanditaire Vennootschap, also known as the CV. The advantages of a CV is that investors (partners) can opt the CV to be treated as fiscally transparent, or as a company subject to Dutch corporate income tax. Next to these “silent” investors, the CV also has a general partner who is representing the CV.
The CV was in our case treated as fiscally transparent. As a result, all private individual investors in the CV became subject to Dutch personal income tax for their income from the Dutch real estate. That also means that we have to ask the Dutch tax authorities to grant these 28 good people a Dutch tax identification number. A lot of paperwork.
The Dutch tax authorities are some times willing to allow one combined tax return for all investors. We are currently looking into that possibility. Hopefully they allow our client to report their income in this situation also in one combined tax return.