Can you minimize my taxation is a frequently asked question. Never are we asked to maximize the taxation. Who does not want to minimize their taxation?
Can you minimize my taxation
This question would assume that we have plenty of tax payers living in the Netherlands that do not mind to be over taxed. Or maybe even that we know a secret that makes you pay much less tax.
BV company secret not to pay a salary
Fortunately some secrets are shared with us. The other day one of our clients was annoyed we did not apply the trick his friend was using. What trick is that then we asked. Well, as owner of a BV we are meeting the minimum salary requirements for him, but his friend simply takes money from the BV. No salary and if the money taken become too high, he simply converts it into a BV loan.
There is a reason why the shareholder needs to take a salary, so this trick is obviously not accepted. The difference between this type of minimizing taxation and how we work in line with the rules, is the moment you are caught. If you are caught taking money from the BV bank account without taking a salary, the Dutch tax office simply state what you took is net salary. To be grossed up plus penalty. That is in fact maximizing taxation and penalties.
Mortgage deduction for two houses
Another secret shared with us is about the mortgage deduction. Some own two houses, one for their own, one rented. The partners then register each at one address and then fully deduct the mortgage interest of both houses.
In a limited number of situations for a limited period of time, the mortgage of two houses can be deducted. But not like this. The penalty issued by the Dutch tax office is that neither house is deductible, as long as tax partners have not chosen what is their main residence.
Getting a divorce saves taxation
One of the sad secrets is that of divorce. Some think that creating a divorce, will help paying less tax. What we see happening is that the one partner is fully in believe of a tax credit after divorce. The other partner has his or her doubts that this is only about taxation. Hence the divorce becomes real in which claims are made between partners.
Tax is exciting
We think tax is exciting. We also have the opinion that meeting the ridiculous number of tax obligations is now main stream. The digitalization we experience, implies that gaps or missed areas no longer exist. Hence minimizing taxation within how we work with the rules and regulations, is not possible. Maybe others have different opinions, we live in a free country, but non legal solutions is like cheating. We do not cheat.