• Service: Tax, Global Transfer Pricing Services, International Tax
  • Type: Regulatory update
  • Date: 12/31/2013

Netherlands - Reassigned authority for treaty-related LOB “catch all” requests 

December 31: In recent years, the Netherlands concluded a number of tax treaties containing a “Limitation of Benefits” (LOB) article that includes a “catch all” clause. Such clauses are found in the income tax treaties concluded with the United States, Japan, Barbados, Kuwait, Bahrain, Hong Kong, and Panama.

The “catch all” clause allows taxpayers that initially would not qualify for the benefits of the relevant treaty nevertheless to access some or all of the benefits provided for in the treaty.

“Catch all” authority is reassigned

The Directorate for International Fiscal Affairs of the Dutch Ministry of Finance has been authorized to deal with such requests. However, this authority is being transferred to the APA/ATR team of the Dutch Tax and Customs Administration in Rotterdam.

According to the Ministry of Finance, the transfer of this authority will streamline the process and make it more efficient, as it is often the case that taxpayers have also submitted / intend to submit an APA/ATR request.

The transfer of this authority will apply to “catch all” requests based on current income tax treaties that include a “catch all” clause, as well as future income tax treaties or other regulations containing such a clause.

The transfer is effective 1 January 2014, and applies to both new and pending requests.

KPMG observation

Currently, there are a number of “catch all” requests pending before the Ministry. Tax professionals in the Netherlands have expressed a hope that the transfer of authority will improve the speed at which requests are dealt with and thereby reduce delay.

Read a December 2013 report prepared by the KPMG member firm in the Netherlands: Transfer of authority to deal with ‘catch all’ requests in respect of the application of certain tax treaties

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