{"id":1537,"date":"2024-10-23T07:35:02","date_gmt":"2024-10-23T05:35:02","guid":{"rendered":"https:\/\/vwg.nl\/uncategorized\/kosten-belastingadvies-niet-aftrekbaar\/"},"modified":"2026-03-03T10:34:49","modified_gmt":"2026-03-03T09:34:49","slug":"tax-advice-costs-are-not-tax-deductible","status":"publish","type":"post","link":"https:\/\/vwg.nl\/en\/kosten-belastingadvies-niet-aftrekbaar\/","title":{"rendered":"Costs of (tax) advice not deductible"},"content":{"rendered":"

The Court in The Hague<\/a> rules that the costs incurred in connection with a US tax claim against the director and major shareholder are not deductible for the private limited company.<\/p>\n\n\n\n

It is not yet known whether an appeal has been lodged against the judgement. We would be interested to find out whether the Court of Appeal and the Supreme Court reach the same conclusions as the district court.<\/p>\n\n\n\n

Yesterday, in our article, we described Digesting away from home = business expenses<\/a> The three questions that must be answered to determine the extent to which expenses incurred by an entrepreneur are deductible costs. The Supreme Court confirmed that, with regard to business entertainment expenses, question 2 does not need to be answered.<\/p>\n\n\n\n

Personal needs<\/h2>\n\n\n\n

A judgment published yesterday by the District Court of The Hague specifically addresses question 2. Question 2 reads: Were the expenses incurred (in part) to meet the entrepreneur\u2019s personal needs?<\/em> Insofar as this is the case, the expenditure does not qualify as a deductible expense. The burden of proof for question 2 rests with the Tax and Customs Administration: it must demonstrate that the expenditure (also) serves to meet the entrepreneur\u2019s personal needs.<\/p>\n\n\n\n

The case considered by the Court concerns a director and major shareholder (DGA) resident in the United States who deducts expenses relating to (tax) advice from a Dutch private limited company (BV). This involves restructuring advice in connection with new US tax legislation and advice relating to US tax compliance (in particular, the completion of the director-shareholder\u2019s US tax forms).<\/p>\n\n\n\n

The court finds that the opinions relate exclusively to a (potential) tax claim which the director and major shareholder must settle. The Tax and Customs Administration has therefore demonstrated that the expenditure was incurred to satisfy the director-major shareholder\u2019s personal needs, meaning that this expenditure does not qualify as a deductible expense. This is because the consequences of any failure to settle the tax claim are borne at the director\u2019s own risk and expense.<\/p>\n\n\n\n

The director and major shareholder argues that, should he be required to settle a tax claim, he can request the private limited company to make (additional) dividend payments. The Court regards this as a hypothetical scenario, which could potentially prove detrimental to the private limited company. However, it cannot be ruled out that the director and major shareholder may have other options for financing the tax claim.<\/p>\n\n\n\n

In addition, the director and major shareholder (DGA) cites a judgment in which the Supreme Court ruled that, as part of good employment practices, an employer must inform employees of changes to legislation that may be relevant to the employees\u2019 tax position. According to the District Court, this does not go so far as to oblige the employer to incur (substantial) consultancy costs in relation to a (potential) tax claim by the employee. The employee is personally responsible for correctly fulfilling their tax obligations.<\/p>","protected":false},"excerpt":{"rendered":"

De Rechtbank Den Haag beslist dat de in verband met een Amerikaanse belastingclaim van de DGA gemaakte kosten niet aftrekbaar zijn voor de BV. Nog niet bekend is of tegen de uitspraak hoger beroep is ingesteld. Het lijkt ons interessant om te vernemen of Hof en Hoge Raad tot dezelfde conclusies komen als de rechtbank. […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1537","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"acf":[],"_links":{"self":[{"href":"https:\/\/vwg.nl\/en\/wp-json\/wp\/v2\/posts\/1537","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vwg.nl\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vwg.nl\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vwg.nl\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/vwg.nl\/en\/wp-json\/wp\/v2\/comments?post=1537"}],"version-history":[{"count":0,"href":"https:\/\/vwg.nl\/en\/wp-json\/wp\/v2\/posts\/1537\/revisions"}],"wp:attachment":[{"href":"https:\/\/vwg.nl\/en\/wp-json\/wp\/v2\/media?parent=1537"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vwg.nl\/en\/wp-json\/wp\/v2\/categories?post=1537"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vwg.nl\/en\/wp-json\/wp\/v2\/tags?post=1537"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}