In Box 3, your income is calculated based on the (value of) the balance of your assets and liabilities in that box as at 1 January of each year. What if an asset vanishes into thin air?
Con artist
A case was recently heard at the District Court of the Northern Netherlands case in which a person entered into a loan agreement on 1 January 2017. On 2 January 2017, he transferred the €100,000 loan to the borrower. The loan was due to be repaid on 7 February 2017, with €10,000 in interest.
It soon became apparent, shortly after 2 January 2017, that fraud had taken place. The amount lent will not be repaid. The court ruled that the €100,000 would nevertheless be taxed in full under Box 3 in 2017. The reference date system can work to the advantage or disadvantage of taxpayers.
New Year’s Eve Lottery
In 2010, the Supreme Court Similarly, with regard to the winner of the top prize in the New Year’s Eve lottery (€20,000,000). This prize was won on New Year’s Eve 2004 and was credited to the winner’s bank account on 4 January 2005. The €20,000,000 was taxed by the Tax and Customs Administration in 2005 under box 3. The Supreme Court has confirmed that this is correct.
SNS shares
The only case in which things went well for the taxpayer concerns the expropriated SNS shares. The party concerned in that case held €290,955 worth of SNS-Reaal shares on 1 January 2013. These shares were expropriated by the Minister of Finance on 1 February 2013.
The Supreme Court has ruled that, in this situation, there is an individual excessive burden on the basis of which the income tax levied on box 3 must be limited. As a result of the expropriation, the interested party’s income fell below the poverty line, partly because the income in box 3 meant he was no longer eligible for housing benefit.