Finance Minister Van Rij, in a letter outlined (further) ideas to Parliament on how income from savings and investments (Box 3) can be determined.
The reason for this is, of course, the “Christmas ruling” handed down by the Supreme Court in 2021. This judgement has since led to the restoration of legal rights for the period from 2017 to 2022 inclusive (but only for those who lodged an objection in good time), in respect of which the tax court has yet to rule on whether this is sufficient. In addition, a transitional scheme has come into force for the period from 2023 to 2025, which will undoubtedly also be submitted to the tax court for assessment. Judging by what he writes in his letter to Parliament, Van Rij does not seem particularly confident that the tax court will approve, in the longer term, the approach adopted for income from savings and investments up to and including 2025.
The ideas
In the letter, Van Rij sets out in more detail the ideas on how income from savings and investments might be determined from 2026 onwards. Naturally, further investigation is needed to determine whether these ideas are feasible, and it is therefore by no means certain exactly what form the scheme will take, but it does seem likely that a (considerably) more detailed (and therefore more complex) scheme will be introduced than the one currently in place. Van Rij outlines a possible variant that could look as follows:
- The flat-rate return is determined on the basis of some 15 separate asset categories (the same categories as those currently used in the income tax return for Box 3);
- The rates of return are determined on the basis of the average netreturn (i.e. the return after deduction of costs);
- for asset classes with a realistic chance of negative average returns, multi-year flat rates are applied (typically based on the average return over the 5 or 10 most recent years);
- the tax-free allowance is converted into tax-free income (which is advantageous for savers, but disadvantageous for holders of asset classes with higher returns AND is disadvantageous for taxpayers whose net worth – the value of their assets minus their liabilities – is lower than the tax-free allowance).