In order to determine whether or not The Netherlands is a suitable jurisdiction to set up your (intermediate) holding company, the following questions can be relevant.

At the level of the Dutch holding:

1. What kind of income is expected from the subsidiaries (dividends, capital gains, interest, management fees) ?
2. Does the Dutch holding have sufficient substance in The Netherlands to qualify as a Dutch tax resident for Dutch and foreign tax purposes ?  
3. Does the income from the subsidiaries qualify for the participation exemption ?
4. Is an advance tax ruling required to get 100% certainty about the application of the participation exemption ?
5. Are internal prices at arm's length (transfer pricing) ?
6. Is the Dutch holding exposed to taxable currency exchange results ?
7. What kind of costs and losses are tax deductible at level of the Dutch holding ?
8. Is the Dutch holding entitled to VAT relief i.e. is it entitled to a refund of the VAT incurred on expenses ?
9. How high will the leverage be of the Dutch holding ?
10. Do thin capitalization provisions or other limitations for interest deduction apply ?
11. Does the Dutch holding have other sources of taxable income to offset against its expenses ?
12. What is the cost of funding of the Dutch holding ?
13. What is the cost of repatriating profits from the Dutch holding (dividend withholding tax) ?
14. What is the exact procedure to obtain a reduced rate for the Dutch withholding tax on dividends ?
15. Is a residence statement required ?

At the level of the subsidiary:

1. What is the withholding tax rate for dividends paid by the subsidiary to the Dutch holding ?
2. What is the procedure to effectuate a reduced (dividend, interest or royalty) withholding tax rate by virtue of treaties or EU Directives ?
3. Are there any anti-abuse provisions to be considered for the reduction of the dividend withholding tax rate in the country of the subsidiary ?
4. Is a residence statement required ?
5. Is the subsidiaries main activity the ownership and exploitation of real estate or providing financial services to group companies ?
6. Are internal prices at arm's length (transfer pricing) ?
7. How are capital gains taxed in the country of the subsidiary when the shares in the subsidiaries are sold/transferred ?
8. Are there any transfer taxes or stamp duties to be considered ?
9. How high can the leverage of the subsidiaries be ?
10. Do thin capitalization provisions or other limitations for interest deduction apply ?
11. What is the withholding tax rate for interest, royalties and management fees ?
12. What is the procedure to effectuate a reduced withholding tax rate by virtue of treaties or EU Directives ?
13. Are there any anti-abuse provisions to be considered for the reduction of the dividend withholding tax rate in the country of the subsidiary ?
14. Does any tax become due in view of equity contributions to the subsidiary ?

At the level of the parent company:

1. Does the shareholder of the Dutch holding become subject to income tax in The Netherlands for capital gains on the shares or other sources of Dutch income ?
2. How is the shareholder of the Dutch company taxed in its country of residence for the income which it receives from the Dutch holding (dividends, capital gains, interest) ?
3. Does the shareholder have the possibility to shelter dividend or interest income ?
4. Does the parent company have sufficient substance in its country of residence to qualify as a Dutch tax resident for Dutch and foreign tax purposes ?  
5. Is any CFC-legislation in place ?
6. Are there any anti-abuse rules to be considered at shareholders level for income from the Dutch holding ?
7. Foreign tax credits available fo withholding taxes incurred ?

We have extensive knowledge an expertise in the area of setting up and maintaining Dutch holding companies and we are gladly prepared to advice you on this subject or to guide you to other professionals who can help you in other specialized areas (like international lawyers, accountants or trust companies).

If you are interested in our services, please feel free to contact us via e-mail or to call us at our offices on the number +31 (10) 2010466.