Inheritance Tax

When you move to another country, you are faced with its rules and idiosyncrasies. Not only in daily life and at work, but also when it comes to other, more formal rules.

Many expats are not aware of the many Dutch tax rules that apply to them too. Some of these rules have been adapted to their specific situation, such as, for instance, the 30%-ruling regarding income tax. But there are also other Dutch tax rules that apply unmitigatedly to expats – such as those regarding inheritances.

Each country has its own rules on taxation. In some countries, inheritance taxes are levied because the deceased had his domicile in that country, even though his habitual residence is elsewhere. Other countries levy taxes over property that is located in that country or because the inheritor lives there. This, of course, can lead to double taxation.

The Netherlands has only entered into a limited number of tax treaties that deal with this issue. If no tax treaty applies, then in some cases a unilateral Dutch regulation can be invoked that will help compensate for the double taxation. For instance, the Dutch State has reached an agreement with a number of international organizations regarding the levying of taxes in case one of their employees passes away while living in the Netherlands. Sometimes certain property is exempted from taxation and in other cases an exemption applies to the entire estate.

Yolanda Bokhorst is a deputy civil law notary with Van Buttingha Wichers Notarissen in The Hague.
She can be contacted at tel.: 070 – 356 68 00 or by e-mail: y.bokhorst@vbwnotarissen.nl.

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