For income tax purposes, a debt is generally linked to what you have acquired with the borrowed amount.
Historical causal link
This is also known as the historical causal link. If you use the loan to purchase an investment property, the debt, like the investment property itself, is taxed under Box 3. If you use the loan to finance your tax-deductible owner-occupied home, the debt may qualify as a home loan (however, a whole set of additional conditions applies for the debt to qualify as a home loan). If you use the loan to purchase shares in a private limited company (BV) that constitute a substantial interest, the debt is taxed under Box 2.
Divorce
In the event of a divorce, the assets must be divided. This allows assets to be separated from the debts used to finance them. This is the subject of a recent ruling handed down by the Gelderland District Court case.
This case concerns two partners who separated in 2011. Naturally, the matrimonial property is divided as a result. One partner is allocated the former marital home. The other partner receives the shares in two private limited companies and the (mortgage) debts used to finance the purchase of the marital home.
New assessment date
This division severs the link between the property and the debt. The Court rules that the division gives rise to a new assessment date. The loan is taken over in order to retain the shares in the private limited companies. Those shares qualify as a substantial interest (Box 2). The debt is therefore taxed under Box 2 following the divorce.
It is striking that the District Court takes the view that this applies to the entire substantial interest. It seems more logical to us that this should apply to the 50% of the shares acquired from the community of property upon divorce. This may well be addressed should the case proceed to the Court of Appeal and/or the Supreme Court.