Recent news of Blue Clue
Will dividend withholding tax between Netherlands and Curaçao go down?
Netherlands and Curaçao have reached an agreement on the new rules on the avoidance of double taxation between the Netherlands and Curaçao. For Curaçao the exemption of dividend withholding tax is important. To prevent avoid abuse the shareholder on Curaçao will have to meet extra conditions.
Netherlands and Curaçao have reached an agreement on the new rules on the avoidance of double taxation between the Netherlands and Curaçao.
An important element in agreement for the Netherlands is the taxation of pension income. Based on this new agreement the Netherlands may levy tax on pension income that was build up in Netherlands but after emigration is received by resident of Curaçao. The Netherlands can also levy gift and inheritance tax up to five years after emigration from the Netherlands to Curacao.
For Curaçao the exemption of dividend withholding tax on dividends received from Dutch participations is very important. To prevent ubuse the Curaçao shareholder will have to meet extra conditions in order to receive the dividends free of dividend withholding tax. For the International Financial Sector of Curaçao it will be important that the extra conditions will be in line the international rules.
Main features of the scheme and application of Article 35a current BRK
The intention is that the new agreement will be in force as of January 1, 2015. Current cases will be grandfathered. The new agreement will replace the existing agreement of 1964. Netherlands is also preparing a new agreement with Aruba and St. Maarten.
What does this mean for our relationships?
Apparently, the dividend withholding tax between the Netherlands and Curacao go down under conditions such that "the relationship with the international market can still be found." Although all the press release provides some clarity, we are very much looking forward to draft agreement itself!