Every year, the local authority assesses the value of your property: the WOZ value. Naturally, you can lodge an objection to that valuation. You can also do so if you believe the value has been set too low; if you want the local authority to set a higher WOZ value. The right to demand a higher WOZ value through an objection has been enshrined in law since 2015.
Significance
That is unusual in itself. The general rule is that you can lodge an objection if you have an interest in doing so. And you have an interest if a ruling in your favour on the objection would benefit you.
The WOZ value forms the basis for local council tax and water board charges. A higher WOZ value naturally means higher charges.
The WOZ value of your home is also important for determining the amount of the notional rental value for income tax purposes. The higher the value of your home, the higher the notional rental value, and the lower the tax deduction relating to your home.
If the plans in the Coalition agreement Under the Rutte III government, people who do not pay any (mortgage) interest on their homes will soon have to pay income tax again on the benefit they derive from their homes.
A higher value of your property does not give you any tax benefits.
Higher WOZ value
So why would you want to argue for a higher WOZ value?
This value is used when assessing the financing of your home. A higher (WOZ) value means greater security for the lender. The lender may then be prepared to grant a larger loan.
A higher (WOZ) value may also mean that any interest rate surcharges you are paying are waived. This could then reduce your monthly fixed costs.
When buying a property, the buyer often takes the WOZ value into account when deciding on the offer to make. In such cases, too, a higher WOZ value can work in their favour.
No back-dated tax assessment
The Supreme Court has recently decided that the legislative amendment introduced on 1 October 2015 – which allows for an appeal to be made on the grounds of a higher WOZ value – also applies to proceedings already underway at that time. That’s good news if you had a case pending.
Of greater interest are the additional rules laid down by the Supreme Court. This is because a higher WOZ value must not result in a higher property tax assessment for the year in question. Furthermore, the Tax and Customs Administration may not issue a supplementary income tax assessment on the basis of the higher WOZ value.