Last week, the finance secretary announced the bill submitted to Parliament regulating the legal basis for the box 3 rebuttal scheme. That rebuttal scheme will run through the Actual Return Statement (OWR) form, which is expected to be by mid-2025 becomes available.
Don't wait
The Zeeland-West Brabant District Court ruled last week that the Tax Administration may not wait with the settlement of requests and objections against the box 3 levy until the OWR form is available. The District Court decided this in a case in which the taxpayer had served the Tax Administration with a notice of default for failing to settle (on time) a request for (ex officio) reduction of a 2019 income tax assessment and a 2023 provisional income tax assessment. The Inland Revenue stated that to settle the submitted requests, the Form OWR should be awaited. Taxpayer then asks for determination of penalty payments. The Tax Administration does not grant that request. The Court does: it awards taxpayer penalty payments of €1,442 (the maximum amount) per request not settled in time. In addition, the Court ruled that the Tax Authorities must still settle the requests within two weeks and that, if they failed to do so, the Tax Authorities would be liable to an additional penalty of €100 per day (with a maximum of €15,000).
Counter evidence
The rebuttal scheme in the bill on the rebuttal scheme box 3 is based on the principle that the taxpayer must make it plausible that the actual return of the total of the assets and liabilities in box 3 is lower than the lump-sum calculated benefit from savings and investments. Here, the normal tax burden of proof applies, meaning that the lower actual return plausible must be made. To the extent that the plausible actual return is lower than the standard return, the tax due will be reduced.
The actual return is never set lower than zero (no loss relief). For the allocation of the actual return to tax partners, the allocation will be determined on the basis of the partner's share in the basis of box 3 (the allocation may be adjusted by the partners as long as the assessment of one of them is not irrevocable; they must, however, appeal it themselves in a timely manner).
It then determines what all is included in the actual return. These are both regular benefits from and capital gains from assets and liabilities. Costs are not taken into account when determining regular benefits. Penalty interest is not included in the (negative) regular benefits (penalty interest is seen as costs, not interest on a debt). If an agreement was concluded under non-business conditions, the regular benefits are determined as if business conditions were agreed upon (at arms length).
The benefit from making a property available for own use is set at the economic rental value. But for the years 2017 to 2025, this benefit is set at nil.
Working back
The box 3 rebuttal scheme law will (for the most part) go back to 1 January 2017. But no relief will be arranged for taxpayers who failed to object to imposed assessments or did not do so in time.
The final assessments for the years through 2021, if income in box 3 has been declared, have largely not yet been imposed. For those assessments for which the assessment period expires, the Tax Administration will impose assessments, possibly without taking into account the rebuttal evidence. A conscious decision has been made not to extend the statutory assessment period. The assessment period starts after the end of the tax year and amounts to 3 years + the extension granted for filing the return.
With effect from 2025, the ability to provide rebuttal evidence will become part of the annual income tax return.