Netherlands Company and Dividends

[Mr Gus]

I agree Dutch Tax man is experienced in those kind of things vs. Poland or Estonian Tax man

So for asset like BTC (if you have decent amount) you would rather hold it as private person not in BV - that would be your advice? (of course not financial advice bla bla bla)

Yeah they are savages

I would keep it on box3, unless you are expecting BTC to go down a lot, however that would only benefit you if you are already generating profits with a B.V.

Best case scenario is to get the F out of the Netherlands.

 

[mikestachurski]

If you have 2 million in dividend stocks (assuming US stocks) it would look like this:
5% of 2M is 100.000
Dividend withholding tax is 15% leaving you with 850000
Box 3 tax would be 30.492 over 2M, however you can deduct the 15% withholding tax, so you will be left with the same 30.492 in tax leaving you with 70K after tax.

Btw you can also get returns on your BTC/WBTC with DEFI (Aave, Pancakeswap) and CEFI (BlockFI, Celcius) however it involves a a lot more risk then just hodling.

(1) I didn't know that the dividend taxes are tax deductible that is new to me - need to read more about it and talk with my accountant - thanks for the tip

(2) I use Celsius and 2 other CEFI solutions to earn yield on my BTC (I only risk like 10-15% of my total stack)

(3) My friend opened BV company and he paid large portion of his BTC into BV and he keeps it there earns yield and some times withdraw earned yield to cover some of the expenses in his private life by doing so he is not paying wealth tax in NL etc. - thoughts? opinion about it? Maybe you heard/read about other people in NL doing it as well?

 

[mikestachurski]

Yeah they are savages

I would keep it on box3, unless you are expecting BTC to go down a lot, however that would only benefit you if you are already generating profits with a B.V.

Best case scenario is to get the F out of the Netherlands.

I am considering f... of from NL by end of the year but than there is nowhere in Europe really where you can go and sell BTC without paying capital tax gains... yes there are Dubai's of this world, Monaco etc. but I am not ultra rich to live in these places

 

[Mr Gus]

I am considering f... of from NL by end of the year but than there is nowhere in Europe really where you can go and sell BTC without paying capital tax gains... yes there are Dubai's of this world, Monaco etc. but I am not ultra rich to live in these places

Why not sell out in the Netherlands, there is no capital gains tax and Dutch banks are generally fine with crypto.

 

[Mr Gus]

(1) I didn't know that the dividend taxes are tax deductible that is new to me - need to read more about it and talk with my accountant - thanks for the tip

(2) I use Celsius and 2 other CEFI solutions to earn yield on my BTC (I only risk like 10-15% of my total stack)

(3) My friend opened BV company and he paid large portion of his BTC into BV and he keeps it there earns yield and some times withdraw earned yield to cover some of the expenses in his private life by doing so he is not paying wealth tax in NL etc. - thoughts? opinion about it? Maybe you heard/read about other people in NL doing it as well?

No dividend withholding taxes are deductible in most cases, normal dividend taxes are never deductible. I have never heard people doing that because the capital gains will be taxed at the corporate tax rate eventually, so I don't see the benefit of putting the money into a B.V. for high yielding assets like BTC.

If you would put 1M into the B.V. and within a few years that turns into 2M and want to cash out you will have to pay tax on the 1 million in gains. Which will be 225000 in corporate tax and 208340 in dividend tax leaving you with 433.340 in taxes to pay. Also don't forget the cost and time for the auditing and maintaining the company. If you would have left it in BOX3 you would have paid 12K a year or something in tax.

 

[mikestachurski]

Why not sell out in the Netherlands, there is no capital gains tax and Dutch banks are generally fine with crypto.

(1) I believe it will go a lot more in the next 10-20 years (that is my time horizon) so don't won't to get out from this 'bus'

(2) I might sell a little selling everything would create another problem where to invest the cash from sale (I am not a big spender and don't care about showing off in Lambo)

 

[mikestachurski]

If you would put 1M into the B.V. and within a few years that turns into 2M and want to cash out you will have to pay tax on the 1 million in gains. Which will be 225000 in corporate tax and 208340 in dividend tax leaving you with 433.340 in taxes to pay. Also don't forget the cost and time for the auditing and maintaining the company. If you would have left it in BOX3 you would have paid 12K a year or something in tax.

So basically I would get 650k (out of €1m profit) into my pocket - would I have to pay income tax on it as well as individual?

So hypothetically I am putting €1m into BV and next year it is €2m I want to cash out I pay €430k in taxes for that keeping it as individual €1m goes up to €2m (and let's assume it stay like this forever - no more appreciation) My wealth tax goes up from €12k (on €1m) to €24k (on €2m) every year so I would need 20 years (20x€24k) to be better of by keeping BTC in BV - I assume that is what you are trying to explain here right?

 

[Jerry1911]

I am considering f... of from NL by end of the year but than there is nowhere in Europe really where you can go and sell BTC without paying capital tax gains... yes there are Dubai's of this world, Monaco etc. but I am not ultra rich to live in these places

You can sell crypto/stock/etc in Croatia tax free if you've been holding them for at least 2 years.

 

[mikestachurski]

You can sell crypto/stock/etc in Croatia tax free if you've been holding them for at least 2 years.

That is interesting to know.

 

[mikestachurski]

No dividend withholding taxes are deductible in most cases, normal dividend taxes are never deductible. I have never heard people doing that because the capital gains will be taxed at the corporate tax rate eventually, so I don't see the benefit of putting the money into a B.V. for high yielding assets like BTC.

If you would put 1M into the B.V. and within a few years that turns into 2M and want to cash out you will have to pay tax on the 1 million in gains. Which will be 225000 in corporate tax and 208340 in dividend tax leaving you with 433.340 in taxes to pay. Also don't forget the cost and time for the auditing and maintaining the company. If you would have left it in BOX3 you would have paid 12K a year or something in tax.

Another mental challange

I paid in €1m in crypto into BV it appreciates in value over time I got €2m in BTC now and I benefited as I avoided wealth tax (if I would keep it as private person)

Now 1-2-3-5 years later I decided to sell €1m of BTC (out of €2m that BV holds) and BV holds now €1m in cash and €1m in BTC.

Next step: BV loans to my PRIVATE self this €1m to finance the house. I set the T&Cs and interest rate like any other bank would do (e.g. 1% 30 years fix) to ensure that TAX MAN won't knock my door.

Now I PRIVATE myself can go and use this €1m loan to buy the house, live in it with my family.

Commitment is that I need to pay back the loan to my BV but (1) I can tax deduct these costs (2) I can't go bankrupt as I own money to myself.

Did I miss something?

QUESTION - BV will have to pay corporate tax on this income generated from loan to myself but I could reduce it / offset it if I generate enough expenses right?

 

[Mr Gus]

Another mental challange

I paid in €1m in crypto into BV it appreciates in value over time I got €2m in BTC now and I benefited as I avoided wealth tax (if I would keep it as private person)

Now 1-2-3-5 years later I decided to sell €1m of BTC (out of €2m that BV holds) and BV holds now €1m in cash and €1m in BTC.

Next step: BV loans to my PRIVATE self this €1m to finance the house. I set the T&Cs and interest rate like any other bank would do (e.g. 1% 30 years fix) to ensure that TAX MAN won't knock my door.

Now I PRIVATE myself can go and use this €1m loan to buy the house, live in it with my family.

Commitment is that I need to pay back the loan to my BV but (1) I can tax deduct these costs (2) I can't go bankrupt as I own money to myself.

Did I miss something?

QUESTION - BV will have to pay corporate tax on this income generated from loan to myself but I could reduce it / offset it if I generate enough expenses right?

Yes that's an option, but you will have to pay tax on that generated 1M in the B.V. eventually, and if you realize the profits on the generated 1M in order to finance your own home you will have to pay corporate tax on those realized profits, so you won't have 1M but 775.000.

But what if your 1M becomes 5M, then you will have 4M sitting in the B.V. ready to be taxed.

Putting BTC into a B.V. is not something I would do.

Yes you can offset that by making enough expenses, but the Dutch taxman is pretty strict on doing personal expenses from your company, so if that is your plan it would stay away from it.

One other problem with a B.V. is that you will to pay a minimum salary of 47000 which will be taxed as personal income tax. You might not have to because there will be very little active trading but that is something you should discuss with your accountant.

 

[Mr Gus]

You might look into a VBI (vrijgestelde beleggingsinstelling) but I don't know a lot about that, you should ask your tax advisor.

 

[mikestachurski]

You might look into a VBI (vrijgestelde beleggingsinstelling) but I don't know a lot about that, you should ask your tax advisor.

no problem thanks for all previous comments / thoughts really helpful

 

[mikestachurski]

Yes that's an option, but you will have to pay tax on that generated 1M in the B.V. eventually, and if you realize the profits on the generated 1M in order to finance your own home you will have to pay corporate tax on those realized profits, so you won't have 1M but 775.000.

But what if your 1M becomes 5M, then you will have 4M sitting in the B.V. ready to be taxed.

Putting BTC into a B.V. is not something I would do.

Yes you can offset that by making enough expenses, but the Dutch taxman is pretty strict on doing personal expenses from your company, so if that is your plan it would stay away from it.

One other problem with a B.V. is that you will to pay a minimum salary of 47000 which will be taxed as personal income tax. You might not have to because there will be very little active trading but that is something you should discuss with your accountant.

Really valuable inputs thanks for that.... very much appreciated. So I am left with 2 options (1) Pay 1.5-2% wealth tax every year and stay in NL or (2) Fu&* off from NL and maybe sell small portion before I do that to have nice cash flow either from renting out property or dividend paying stocks

 

[Jerry1911]

Would a STAK stichting help you in any way?

extra words

 

[Mr Gus]

Would a STAK stichting help you in any way?

extra words

Don't think so, that is only to cover up the UBO(s) for the outside world, or to give employees a share of the profits of the company they are working for.

 

[Mr Gus]

no problem thanks for all previous comments / thoughts really helpful

No problem, happy to help haha

 

[Mr Gus]

Really valuable inputs thanks for that.... very much appreciated. So I am left with 2 options (1) Pay 1.5-2% wealth tax every year and stay in NL or (2) Fu&* off from NL and maybe sell small portion before I do that to have nice cash flow either from renting out property or dividend paying stocks

If you are unemployed and bitcoin is your only source of income you could also decide to move your mortgage from box1 to box3 and you can deduct the amount of the mortgage from your net worth. 1M mortgage and 1M in BTC will result in no tax in box3. But if you are employed you most likely better off keeping your mortgage in box1 because of more deductions.

But yeah in terms of lowering your tax bill it would be better the get out of the Netherlands, but to be honest I think paying taxes on BTC isn't that bad in the Netherlands. The only reason I would move out of the Netherlands if you have active income or low yielding investments but huge net worth, but for BTC the Netherlands is actually a really good place imo. Just run some calculations on how much tax you would have paid in the Netherlands vs the US or any other country with capital gains tax.

 

[Verbatim]

You can sell crypto/stock/etc in Croatia tax free if you've been holding them for at least 2 years.

is this written in a law and are there any judicial decisions about this or is it a directive that can change in a moment's notice? Slovenia had "tax-free" and its over now. Austria as well.

 

[myshufflemix]

Best case scenario is to get the F out of the Netherlands.

and where would you go then? Luxembourg maybe ?