The Supreme Court recently ruled that you must be able to provide evidence of the deduction of (mortgage) interest on your own home every year. In principle, the same applies to your debts in box 3.
Heritage
This was the ruling of the Court of Appeal in The Hague (3 May 2019, No. BK-18/00946). This case concerns a daughter who is her mother’s sole heir. Her mother’s administrator, a foundation, submitted the income tax return for 2015. That return included €99,400 as the basis for calculating income from savings and investments (Box 3). This figure relates to bank and savings balances, less the tax-free allowance and the elderly allowance.
Following her mother’s death in 2016, the daughter lodged an objection to the tax assessment issued on the basis of the tax return. She argued that her mother had substantial debts, meaning that the basis for calculating the return was nil.
Proof
The daughter substantiates the existence of her mother’s debts by nothing more than the assertion that details of the debts had already been provided to the Tax and Customs Administration in 2003 and 2013. The Court of Appeal in The Hague ruled – in our view, quite rightly – that this is not sufficient to establish that the mother still had the debts on 1 January 2015, the assessment date for Box 3 in 2015.
The court had already ruled that the burden of proof lay with the taxpayer. This applies both to the existence and to the amount of the debts. The daughter was also no longer permitted to submit evidence during the proceedings. The court ruled that she had had more than ample opportunity to submit supporting documents during the proceedings.