Participation Exemption

Participation Exemption

Provided that certain conditions are met, the Dutch participation exemption rules allow a total exemption from Dutch corporate income tax of (foreign source) income from dividends and capital gains from subsidiaries and qualified participations. This exemption is granted provided:

1 the participation is at least 5% of the nominal paid-up capital of the subsidiary; and

2 the subsidiary does not qualify as a low-tax portfolio investment company subject to an effective tax rate of less than 10%.