Capital Gains and Investment Income in the Netherlands

Exemptions and Tax Implications

For residents and non-residents of the Netherlands, capital gains and investment income are generally not subject to taxation, except as outlined in Box 2. However, individuals and companies may qualify for exemptions under certain conditions.

Capital Gains Tax

One of the main levies in the Netherlands is the capital gains tax. However, individuals and companies can benefit from exemptions when selling assets. For instance, the sale of a primary residence is exempt from capital gains tax. Additionally, there is a lifetime exemption for capital gains realized on the sale of shares in qualifying companies.

Rental Income

In the Netherlands, actual rental income is not taxed. Instead, the Dutch tax office assumes a notional yield of up to 6% on the property's value. This notional income is then taxed as part of Box 1.

Participation Exemption

The participation exemption is a tax exemption that applies to capital gains realized on the disposal of shares in qualifying companies. To qualify for the exemption, certain conditions must be met, such as a minimum holding period and a substantial interest in the company.