News item | 28-04-2022 | 13:26
The approximately 60,000 people who have objected to the levy in box 3 for the 2017-2020 tax years will receive automatic restitution before 4 August in accordance with the so-called ‘savings variant’. This is mainly people with savings get money back. This recovery also applies to box 3 assessments that have not yet been determined or imposed (including 2020 and 2021). The cabinet announced this in a letter to the House of Representatives on Thursday, following a ruling by the Supreme Court at the end of last year.
People who have not submitted an objection in time and for whom the assessment has already been established will not yet receive a restoration of rights. A ruling by the Supreme Court in another box 3 procedure, which is expected in the autumn of 2022, is still of great importance. The recovery now costs €2.8 billion. In a spring memorandum, no later than 1 June 2022, the House will be informed of the budgetary coverage.
In the savings variant, people automatically receive legal redress on the basis of a new calculation that ties in with the actual distribution of a taxpayer’s savings and investments. People with savings are taxed on the basis of the current savings interest. In recent years it was almost 0%. For debts, the mortgage interest rate is linked and for investments (securities, real estate) the multi-year average return for investments is assumed – just like now.
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This is a big difference with the current situation, where it is assumed that the capital on which you pay tax consists for a certain part of investments, even if that is not the case and the capital consists entirely of savings. The biggest advantage of the savings variant is that it prevents investors who have achieved a good return over several years from getting money back in bad years. The government therefore considers this variant more fair than the other fixed-rate variant that was also in the picture.
The cabinet also proposes to elaborate the savings variant in a bill so that this variant also applies to the bridging years 2023 and 2024. This bill will be sent to the House of Representatives on Budget Day. From 2025 there will be a new system in which the tax is levied on the actual return in box 3.
In order to be able to offer the approximately 60,000 objectors for legal redress before August 4 (in line with the statutory term of six months) and to properly process the 2021 income tax returns, decision-making before the end of April was necessary for the Tax Authorities. For example, adjustments in the IT systems can be made on time.
Automatic money back
Taxpayers do not have to take any action to receive the reinstatement. They will automatically receive a refund before the latest date of August 4. The same applies to all assessments for the 2021 tax year. These assessments will be imposed in phases from August. From mid-September, recovery will also be offered to the attacks from 2017 to 2020, which had not yet been irrevocably established on 24-12-2021. From mid-October, the restoration of rights will then follow for the returns 2017 to 2020 inclusive for which no assessment has yet been imposed. Also for all these groups, people are automatically notified about this, they do not have to take any action. People on the website of the Tax and Customs Administration are expected to use a calculation tool to calculate how the assessment came about in July.
Not in time objection
A ruling from the Supreme Court is expected in the autumn in another box 3 procedure, which is important for the question of whether people who have not objected in time should also be entitled to recovery. While the Tax and Customs Administration will already be working on the recovery in the coming six months, it will become clear during this period what the Supreme Court will rule in that judgment. The cabinet will then take a decision before the end of the year on the definitive target group for the restoration of rights. This group also does not need to take any action. People who do not agree with the decision of the cabinet still have the option of submitting a so-called ex officio request for reduction (and, if it is rejected, to lodge an objection and appeal). Previously submitted requests will be held on hold until a decision has been made.
Current declaration
People with box 3 income who filed a tax return on time this year will not receive an assessment before 1 July as usual this year. The Tax and Customs Administration keeps the returns with box 3 separate and these assessments will be imposed in phases from August. A new version of the 2021 online tax return is also expected to be available in August, which includes the restoration of rights. People can then resubmit the return for 2021 if they wish. For example, you can choose to apply a new partner distribution.
Taxpayers who filed a return for the year 2021 before 1 May and expect a refund will initially receive a provisional assessment based on the old system. In this way the tax money can pay out the amount as usual. At a later date, they will receive a final assessment that takes into account the judgment.