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For the purposes of allocating the right to tax salary from employment, a 183-day rule has been included in tax treaties. If a resident of another State is employed by a foreign employer to work in the Netherlands and there is no economic employer or permanent establishment of the foreign employer in the Netherlands, then the Netherlands only has the power to tax if the employee spends at least 183 days in the Netherlands during a 12-month period (or calendar year, depending on the text of the treaty).

Being compliant with export control and sanctions legislation is of great importance for companies engaged in international trade as violation of this legislation can lead to severe penalties as well as reputational damage. Companies should therefore be well aware of the risks related to export control and sanctions and take measures to mitigate these risks.

Please find set out below some interesting recent developments concerning EU and U.S. export controls and sanctions.

Unseen and KPMG Meijburg & Co are delighted to announce that Pasi Orrensalo is the winner of this year’s Meijburg Art Commission.

Following the informal meeting of the Economic and Financial Affairs Council (Ecofin) of the European Union held in Tallinn on September 15 and 16, 2017, the European Commission published its Communication on a fair and efficient tax system in the European Union for the digital single market. 

We recently informed you about the request for a preliminary ruling in the Ryanair case (C-249-17). That case, pending before the Court of Justice of the European Union (hereinafter: CJEU), concerns the question whether VAT on professional services is deductible if the proposed takeover of a participation is ultimately unsuccessful. 

On October 12, 2017 the European Court of Justice (“CJEU”) ruled in favor of Meijburg & Co’s warranty and recall case (C-661/15), meaning that the period for price adjustments has been extended from one year to three years. Furthermore, recalls necessary to avoid risks of failure must be treated equally as defective goods. This will lead to more opportunities for a customs duties refund in the case of recalls and warranties.

The 30% ruling is a fixed allowance paid to compensate for the costs of a temporary stay outside the country of origin (extraterritorial expenses). Since January 1, 2012 only employees who resided more than 150 kilometers from the Dutch border during at least two-thirds of the 24 months preceding the commencement of their employment or secondment in the Netherlands are eligible for the 30% ruling.

On December 8, 2017, the EU and Japan announced the successful conclusion of the negotiations regarding the Economic Partnership Agreement (EPA). The EPA is to date the biggest bilateral trade agreement negotiated by the EU. The finalizing of the legal text is an important step forward to putting the agreement in place.

On February 22, 2018, the Court of Justice of the European Union (CJEU) rendered judgment in two interesting corporate income tax cases for which the Dutch Supreme Court had requested preliminary rulings (see our previous memorandum). 

On May 11, 2018, the Dutch Deputy Minister of Finance published a new Transfer Pricing Decree, dated April 22, 2018 (no. 2018-6865). This decree replaces the Transfer Pricing Decree of November 14, 2013 (no. IFZ 2013/184M).