Deferral of various taxes
Entrepreneurs may receive special deferral for various taxes. The conditions for applying for special deferral of payment have been relaxed due to the corona crisis. Initially only for four species, but the list was expanded later.
The relaxed extension applies to the following taxes and charges:
- income tax / national insurance contributions;
- payroll taxes;
- Corporation tax;
- sales tax (VAT);
- gambling tax;
- insurance tax;
- landlord levy;
- environmental taxes (energy tax / storage for sustainable energy and climate transition, coal tax, waste tax, tap water tax);
- excise duty (mineral oils, alcohol and tobacco);
- consumption tax of non-alcoholic drinks;
- income-related contribution Health Insurance Act
- BPM for licensees (from May 2020).
Dividend tax is explicitly excluded from the relaxed deferral policy, because paying dividends actually weakens the liquidity position of companies. The cabinet calls on companies not to distribute dividends for the time being. Also, turnover tax, excise duties, consumption tax on non-alcoholic drinks and coal tax, insofar as these taxes are levied under the customs legislation on imports, are exempt.
After receipt (additional assessment)
Any entrepreneur who has run into financial problems as a result of the corona crisis is eligible for deferral of his tax debt. Postponement can be applied for after a declaration has been made and a (supplementary) assessment has been received.
The Tax and Customs Administration cannot process a request for deferment of payment that is made before a (supplementary) assessment has been imposed and must be resubmitted. However, for five tax types it is not necessary to receive an assessment per tax type, one tax assessment will suffice.
The entrepreneur indicates per tax type whether he wants deferment of payment. Except for income tax, income-related health insurance contribution, corporation tax, payroll taxes and turnover tax (VAT). For these five, deferral of payment can be applied for at once. It is not necessary to wait until all five assessments have been imposed, one assessment is sufficient. If desired, the entrepreneur can pay a tax assessment received if he does not need the postponement.
If the entrepreneur receives an assessment for a type of tax for which he has not yet applied for a postponement, a separate postponement must still be requested for that tax assessment.
By online form or letter
The postponement can be requested with an online form or by letter.
The online option is only open for deferral requests of up to three months. The online form ‘Request special postponement of payment for 3 months’ is available on the website of the Tax and Customs Administration. Access is secured with DigiD. Even if the company is a legal entity, the DigiD (from an employee or tax service provider) must be used. The Digid only uses the Tax Authorities for access, it is not stored further.
The request for deferment of payment can also be submitted in writing by sending a letter to:
PO Box 100
6400 AC Heerlen
From the moment that the entrepreneur reports, the collection of his tax debts for the requested taxes is stopped immediately, for the period that the entrepreneur has made in his request. This also applies to tax debts that arose before the corona crisis broke out. The substantive assessment by the tax authorities of the request will only take place after three months. This means that the entrepreneur actually receives a deferment of payment immediately.
The request also only needs to be made once. The postponement applies to assessments already imposed from the date of the request for deferment of payment and all assessments still to be imposed in the following months that the payment deferment applies. The postponement also applies until the tax authorities decide on the postponement request.
More than three months
It is possible that deferment of payment for three months is still too short for entrepreneurs. Entrepreneurs can also apply for an extension for a period longer than three months. This request cannot be made online, but must be made in writing. The entrepreneur may request this longer period of delay in his first request for postponement or may request this within the period of three months after his first request for postponement.
With the request, the entrepreneur must indicate the circumstances in which his company has been affected by the corona crisis and longer delays are necessary. For example, because the turnover figures, orders, orders or reservations have decreased significantly compared to previous months. He can also demonstrate on the basis of recent annual reports that his company was viable prior to the corona crisis. The entrepreneur must provide this information within the three-month period. The tax liability for which deferment is requested must also be complied with.
Prohibition of dividends, bonuses and share buybacks
In the event of a postponement of more than three months, the entrepreneur must declare that no bonuses are paid to the Board of Directors and the management of the company, no dividend is paid and no treasury shares are repurchased in the period from the submission of the postponement request to and with the date of the meeting at which the annual accounts are adopted in 2021.
Bonuses also include profit distributions and other payments that have bonus features. This condition does not apply to bonuses, dividends and shares for which payment and redemption take place after the deferral request, but the underlying decision was taken in 2019.
Total tax liability up to € 20,000
If the total tax debt at the time the Tax Authorities receive the request for postponement is less than € 20,000, the written request will suffice. A statement by a so-called third-party expert is not necessary.
Total tax liability from € 20,000
With a total tax debt of € 20,000 or more, a statement from a third-party expert must be submitted. The third expert must state that it is plausible that the financial problems have mainly arisen from the corona crisis.
A third-party expert is, for example, an external consultant, an external financier, a sector organization or the entrepreneur’s tax advisor or accountant. It should not be someone from your own company or a person who (objectively) lacks expertise.
The statement by the third-party expert is free of form and must at least contain the following elements in terms of content:
- A statement that there are likely to be actual payment problems at the time of the request for postponement or expected to occur shortly thereafter. The term “short term” includes the period in which the corona restrictions of the cabinet apply to the entrepreneur concerned (for example, closure of the catering industry, sports facilities and the ban on events).
- A statement that it is plausible that these payment problems were mainly caused by the corona crisis.
- A liquidity forecast that, according to the third-party expert, is plausible. This forecast is based on the facts and circumstances known at the time of submitting the request for deferment of payment.
- In the explanation to the statement, the third-party expert indicates which documents or data have been provided by the entrepreneur, if necessary with further explanation. A so-called insurance statement that indicates that the entrepreneur meets the conditions is not required.
During the postponement, the Tax and Customs Administration may request interim repayments if the entrepreneur’s liquidity position allows this.
Requests for deferment of payments must be handled manually, so that processing times can increase if many requests are received. In order to accommodate entrepreneurs, the Tax and Customs Administration will automatically omit or reverse the default penalty for late or late payment. This concerns payment defaults made in the period from March 12, 2020 until the date that the special deferral of payment ends.
Therefore, entrepreneurs do not have to pay the fine and do not have to file a notice of objection against the fine if they do receive a tax assessment with a fine. The fine is officially set aside by the tax authorities.
However, it also happens that entrepreneurs have not been able to pay on time due to the corona crisis, but that their financial position has improved by the time they receive the additional assessment, so that they no longer need any further deferment of payment at that time and are therefore not officially required. apply for deferment of payment. In those cases, the tax authorities will also cancel the payment default penalty, provided the entrepreneur pays the additional assessment in good time. It is not necessary to object to the payment default penalty.
Written acknowledgment of receipt
After receiving the request for postponement, the Tax and Customs Administration will send a written confirmation of receipt. The taxpayer only receives one acknowledgment of receipt, even if the request for postponement is intended for several assessments. Due to the increasing treatment times, shipping can take some time.
Inability to pay notification
The Tax and Customs Administration has changed the policy regarding notification of insolvency. If someone – in his capacity as director of a commercial company that is a legal person and is subject to corporation tax – submits the request for postponement for payroll taxes and / or turnover tax (VAT), the Tax and Customs Administration also considers the postponement request as a timely notification of insolvency. Moreover, the notification is considered to be legally valid, unless it subsequently emerges that the inability to pay is not primarily related to the consequences of the corona crisis.
The notification therefore no longer has to be made separately. The new policy applies to tax return periods that end after 1 February 2020. The Tax and Customs Administration assesses the notification of insolvency and provides separate feedback on this.
Concurrence with other postponement
The Tax and Customs Administration assesses the request for special deferment of payment separately from a request that has already been granted previously or, at the same time, an ongoing request for deferment of payment on other grounds.
During the period that the special deferral of payment is in progress, the Tax and Customs Administration will not set off any tax refunds against the tax debt for which deferred payment has been granted. Offsetting takes place if the entrepreneur requests this or the interests of the State are harmed. Import duties will be settled.
The Tax and Customs Administration does not grant a special deferral of payment and withdraws a special deferment of payment granted if the interests of the State oppose (further) postponement. This is the case, among other things, if there is fear of abuse of the situation, which would jeopardize redress.
Extension of deferment obtained
If the obtained delay for three months expires soon and the entrepreneur needs an extension, he must apply for this separately. The tax authorities would like that request to be made with an online form. This will be available from 29 June 2020. A written request is possible, but much more laborious for both the entrepreneur and the tax authorities.
An extension granted by the Tax Authorities applies until the Tax Authorities withdraws it. In any case, an extended postponement will not be withdrawn before 1 October 2020.
The special deferred payment granted is temporary. The Tax and Customs Administration withdraws it as soon as circumstances make this possible. This may be the case if the government removes restrictions on the industry in which the entrepreneur is operating. In any case, withdrawal before 1 October 2020 is not an issue.
From the withdrawal of the postponement, current tax obligations, such as the payment of turnover tax and payroll taxes, must be fulfilled again.
Before revocation, the entrepreneur will have the opportunity to conclude an appropriate payment arrangement that is not bound by a maximum term or other requirements set in the regular deferral policy.
Payment scheme design
The Cabinet is considering deliberating the deferral of payment in a responsible manner and the design of the payment scheme.
Three criteria apply to the design of the payment scheme:
- The payment scheme must be designed in such a way that it is realistic that entrepreneurs can actually pay their outstanding tax debts within the set term. After all, the purpose of the deferment of payment is to keep entrepreneurs upright. Moreover, the tax revenues do not benefit from bankruptcies of entrepreneurs.
- The payment arrangement must be appropriate to the situation of the entrepreneur. After all, the diversity between entrepreneurs is great and the government wants to take this into account.
- The payment arrangement must be enforceable by the tax authorities.
The Cabinet is committed to a payment scheme per sector, in order to ensure as much as possible that entrepreneurs in the most severely affected sectors can also obtain a realistic payment scheme.
Until October 1, 2020
The relaxed postponement policy initially applied until June 19, 2020. However, on 28 May 2020, the government shifted this end date to 1 October 2020.