News item | 24-03-2022 | 15:30
Today, State Secretary Van Rij sent the amended bill to tackle excessive borrowing from one’s own BV from 2023 to the House of Representatives, in accordance with the agreement in the coalition agreement. The government wants to prevent excessive borrowing from its own BV. By borrowing (excessively) from your own BV, taxation in box 2 can be postponed or even adjusted. The government does not consider this desirable.
From 1 January 2023, substantial interest holders who borrow more than 700,000 euros from their own BV must pay income tax in box 2. Currently, it is often possible for substantial interest holders to borrow money from their company without paying tax at that time. As a result, there is a tax incentive not to pay dividends or wages and instead lend the money.
It has been found that these loans are becoming more common. In 2007, for example, there was an amount of 19.7 billion euros in debt owed to the company itself, and in 2018 this increased to 62.4 billion euros.
The option to privately dispose of box 2 capital through loans without paying tax on it is limited by this bill. In addition, the current design of the box system creates inequality between different types of entrepreneurs. It depends on the legal form that an entrepreneur has chosen whether or not it is possible to borrow from his own company. This inequality is limited by this bill.
An earlier version of the bill was sent to the House of Representatives in 2020 and was subsequently detained by the previous cabinet. Substantial interest holders were already prepared for this bill in 2019 via an internet consultation and have acted accordingly. In 2019, approximately 13.6 billion euros more in dividend was paid. This has resulted in an additional tax revenue in box 2 of 3.4 billion euros.