Grant Thornton follows up!

Dear client, said a recent communication from GT

The tax authorities are currently issuing the 2022 ground tax assessments; therefore, we would like to inform you about certain aspects, to be taken into account, when you receive yours.

As you recall, Effective January 1st, 2019, the ground tax tariff of 0.4% has been amended. As of that date, a different ground tax tariff was introduced, depending on the value of the property.

Additionally, it was determined that for certain taxpayers, such as non-residents, legal persons, and residents owning a house with a value of Afl. 750,000 or higher, the ground tax tariff will amount to 0.6%.

We are of the opinion that the above-mentioned change cannot take place within the 5-year cycle of 2017-2021, and are therefore not in agreement with the ground tax legislation.

We are currently awaiting the decision of the Supreme Court in the Netherlands on whether the 0.2% increase for certain taxpayers in 2019 – 2021 was correctly imposed.

Ground tax assessments 2022.

The 2022 ground tax assessments are dated May 31, 2022. The amount of ground tax to be paid depends on the taxable value, in Dutch: leggerwaarde, of your property and/or land.

Please note that the ground tax can be paid in full, one time, or in instalments. Taking into account that 2022 is the first year of a new 5-year cycle, this is also the year in which the tax authorities are able to reassess the value of your property.

Please review this carefully. In case you do not agree with the value imposed by the tax authorities, you can file out an objection against this assessment within 2 months after the assessment date.

Please note that an objection against the new assessment is possible, only in the first year of the 5-year cycle. If no objection is filed in the first year of the 5-year cycle, the assessment will apply for 5 years.

We also note that the increase in tariff for certain taxpayers as of 2022 is possible in accordance with the corresponding ground tax legislation. Therefore, no objections can be filed against the tariff as of 2022.

Pay attention: One of the proposed changes in the tax reform is to limit the depreciation on real estate for profit tax purposes against the leggerwaarde. As previously mentioned, this leggerwaarde is determined by the tax authorities and the value is used to calculate the ground tax due.

Depreciation of buildings for profit tax purposes will be allowed insofar the book-value of the building exceeds the leggerwaarde. Therefore, review carefully, if you are in agreement with the leggerwaarde in your 2022 ground tax assessment, since the value can have consequences for the profit tax and the ground tax.

In case of any questions, please do not hesitate to contact our tax team.

Kind regards, Grant Thornton Aruba

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May 22, 2022
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