Global

Details

  • Service: Tax, Global Indirect Tax, Global Compliance Management Services
  • Type: Regulatory update
  • Date: 8/3/2012

The Netherlands - VAT rate of 21%, effective October 2012 

August 3:   The general value added tax (VAT) rate in the Netherlands will increase from 19% to 21%, effective 1 October 2012.

Effective date implications

In general, the VAT rate increase means that:


  • The supply of a good or a service rendered before 1 October 2012 will continue to be subject to VAT at the rate of 19% (without regard to whether the VAT may only be due on or after 1 October 2012).
  • The supply of a good or a service rendered on or after 1 October 2012 will be subject to VAT at the rate of 21%. This rule also applies if advance payments were made on the basis of a 19% VAT rate; in these instances, as of 1 October 2012, an additional amount (2%) of VAT will be owed. With regard to advance payments made before 1 October 2012, in respect of services provided after 1 October 2012, it is permissible to apply the 21% VAT rate to these payments.
  • If the VAT liability at the 19% rate arose before 1 October 2012, but relates to services that are subject to the new 21% rate, a business may charge the customer for the additional amount (2%) of VAT owed—for example, in situations of advance payments or contracts already concluded for which the contracted prices assumed a 19% VAT rate.

Read an August 2012 report, prepared by the KPMG member firm in the Netherlands: VAT rate increase from 19% to 21%: points to consider




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