News item | 23-02-2023 | 5:45 pm
The current percentage of tax interest for corporation tax and withholding tax will not be increased to 10.5% as of March 1, 2023, but will remain at 8%. The government does not want to implement an increase at this time, because it will review the percentages of the tax interest later this spring.
Two different percentages apply to the tax interest: a percentage of at least 8% applies to corporate income tax and withholding tax, and a percentage of at least 4% applies to other taxes for which tax interest can be charged. Tax interest can, for example, be charged if the Tax and Customs Administration is unable to determine an assessment in time, for example if a taxpayer is late in filing a tax return. The tax interest is therefore an incentive for timely and correct filing of the tax return. Incidentally, that also applies the other way around; if the Tax and Customs Administration takes too long to impose an assessment for which an amount must be paid, interest will be paid to the taxpayer.
No increase
The percentage of tax interest for corporate income tax and withholding tax is determined on the basis of the basic financing rate of the European Central Bank (ECB). The ECB recently announced an interest rate of 2.5%, which would mean that the tax interest payable will be increased to 10.5% as of March 1. The government does not consider this increase desirable at this time and will review the percentages of the tax interest later this spring. In addition, research is currently being done into the tax interest system, including the interest rates.
Change policy decision
In order to keep the percentage of tax interest for corporation tax and withholding tax at 8%, the Tax and Collection Interest Decree will be amended as soon as possible.
This is expected to be done in the second quarter of 2023. In the period from 1 March until the Tax and Collection Interest Decree has been amended, the following applies: for taxpayers who are entitled to the compensation of tax interest, a percentage of 10.5% will continue to apply. These taxpayers receive a supplementary payment, for which they do not have to take any action. For taxpayers who have to pay tax interest, an interest rate of 8% will continue to apply from 1 March 2023. This temporary difference will end when the amended decision takes effect. From that moment on, a percentage of 8% applies to both the tax interest to be reimbursed and to the tax interest to be charged, at least until a new decision has been taken.