Property transfer tax
Do you buy property, such as a house, company building, or plot of land? Or do you buy or inherit the rights to immovable property? You will probably have to pay property (or capital) transfer tax (overdrachtsbelasting, odb).
When to pay property transfer tax?
In the Netherlands, you pay property transfer tax (in Dutch) when you become the owner of:
- immovable property, such as business premises, a plot, or a residential building
- rights to immovable property, such as building and planting rights, or a leasehold
- shares in a public limited company (NV), private limited company (BV), or partnership, whose possessions mainly consist of immovable property
The property transfer tax is not tax deductible as business costs. You must add up the tax to the property's balance sheet value, which forms the asset's depreciable basis. Depreciation does not apply to undeveloped land.
How to pay property transfer tax?
Normally, a civil-law notary draws up a deed to transfer a (business) property. They then charge the property transfer tax owed, file the property tax return on your behalf, and pay the tax to the Netherlands Tax Administration (Belastingdienst). When you do not draw up a notary deed you must apply for and fill out a property transfer tax form within 1 month of becoming the property owner. You can request the form for this with the Tax information line of the Tax Administration
Exemptions from property transfer tax
In some situations you can get an exemption from paying the property transfer tax (in Dutch). For instance when a property is transferred to you by a relative, or when you transfer immovable property into a private limited company.
In some cases, you do not have to pay and declare the property transfer tax (in Dutch). For instance, when you inherit immovable property, or when you become its owner through a divorce.
Property transfer tax and VAT
When you buy immovable property that is charged with VAT, a property transfer tax exemption may apply. Please ask the Tax Administration about the exact conditions or check the (Dutch-language) online tool for situations in which there is concurrence of VAT and property transfer tax.
Object to the property transfer tax
Did you pay property transfer tax, but do you disagree on the rate? Or do you think you are entitled to an exemption? You can file an objection (in Dutch). You need to send your objection by sending a letter to the Tax administration within 6 weeks after you paid the tax.