Evaluation VAT exemptions|Real Estate Transfer Tax concurrence exemption (RETT)

The VAT Act contains many statutory exemptions. If a transaction (goods or services) meets the requirements of one of these exemptions, no VAT is due on that specific transaction. The major disadvantage of an exemption is that you are (usually) no longer entitled to deduct VAT on costs related to this transaction. During the presentation of the 2024 Budget Day (Miljoenennota), it was indicated that a number of these exemptions will be evaluated.

According to the appendix, the following exemptions will be evaluated:

https://www.rijksoverheid.nl/binaries/rijksoverheid/documenten/begrotingen/2023/09/19/bijlagen-miljoenennota-2024/bijlagen-miljoenennota-2024.pdf

• Exemption for (among others) composers, writers and journalists

In addition, somewhat hidden, it has been indicated that the RETT concurrence exemption is also on the agenda for evaluation. This concerns the exemption for the situation in which the supply of immovable property is subject to both VAT (at the supplier) and RETT (at the acquirer). To prevent double taxation, an exemption from transfer tax may apply (the RETT concurrence exemption). Although this concerns an RETT exemption (see news item evaluation of transfer tax exemptions), this evaluation is carried out in the context of the evaluation for VAT exemptions.

The RETT concurrence exemption is very important in practice, given the possible double taxation of RETT and VAT and the major financial interests in transactions with immovable property. It is therefore important that you are informed at an early stage about this evaluation and any changes to the exemptions that may follow from the evaluation. We will therefore closely monitor these developments.

If you would like to know more about this evaluation, please do not hesitate to contact us.

If you have any questions about this topic or if you would like to discuss the topic further, please do not hesitate to contact us at info@vatpartners.com