Dear readers,
In December last year, I submitted a request to the Foreign Revenue Office for an exemption from withholding payroll tax, because my previous exemption was due to end on March 1, 2019. All copies imaginable and proof of deregistration from the Netherlands must be included.
Received a letter in February that my request was not complete, I had to show proof of tax residence, I had to submit this request within 6 weeks so that my request could be processed further. I wrote a response to this that people had to comply with the tax treaty between the Netherlands and Thailand, etc. and that I would object if they were to withhold.
Now I saw last weekend that payroll tax has been deducted from my pension benefit, while the correspondence with Heerlen is still ongoing, because I have not yet received a message or. receive confirmation of a rejection. Called my pension fund about this and it confirmed that this was on behalf of the Tax and Customs Administration Buitenland Heerlen. Belastingdienst Heerlen also called, advice was to wait for a message from Heerlen.
Now my question, is this possible? I know that the term would end on March 1, 2019. Should I submit an objection now or should I wait for a message from Heerlen?
Maybe someone can express their thoughts on this.
Regards,
Hennie
What is the problem with showing proof of tax residency?
If you say you live in Thailand, you will have to prove that, just saying it is not enough, just as not being deregistered from the Netherlands.
The Dutch tax authorities accept paying tax in Thailand, or at least filing a tax return, as proof.
It does not seem unreasonable to me that a tax authority wants to see being registered with the Thai tax authorities as proof, and not all sorts of other papers.
After all, it's all about where taxes are levied, that's all that matters to the tax authorities.
Dear Ruud,
This is not my question, payroll tax has already been withheld, there has not yet been a rejection, and you know very well that Heerlen must also comply with the Netherlands-Thailand tax treaty.
Messrs. Lammert de Haan and Eric have already written a great deal about this.
In the first instance, it is not the tax authorities that deduct these payroll tax costs, but in your case the pension fund that is obliged to pay these costs to the tax authorities.
As long as this agency that pays you does not receive the green signal from the tax authorities for these levy costs, it is furthermore obliged to pay them.
Only when you have completed the correct procedure, so that you can clearly demonstrate, among other things, that you are now a tax resident of Thailand, and have already been deregistered from the Netherlands, will this signal go green.
As long as this exemption request has not been made to the satisfaction of the tax authorities, your pension insurance must include this further.
Paying wage tax in NL, totally OK as far as I'm concerned, but national insurance contributions and ZVW premiums that I am not entitled to as a deregistered person (registered in RNI), that goes too far for me.
One of my pension insurers refuses to adjust this and wants an exemption from the NL Tax Authorities. The other did well of its own accord. I live off my savings and receive my pension on a NL account. It's fine to pay taxes on that.
The exemption form already starts with the requirement that you must send a tax statement from Thailand, otherwise they will not process the request. But I don't WANT any tax exemption at all! I want exemption from premiums for things I am not entitled to. Logical right? I also don't want to pay for peanut butter in the supermarket that I don't buy.
Am I wrong and/or does anyone have any experience?
Dear Paul,
You see it partly right and possibly partly wrong.
As far as the national insurance contributions and the income-related contribution under the Healthcare Insurance Act are concerned, you are indeed correct: you fall outside the circle of insured persons.
There are some pension providers and insurers that still request an exemption from the Tax and Customs Administration, even if you live abroad. One of them is ACHMEA. And actually that is too crazy for words. That would mean that an old granny of 90 years in the Netherlands applies for exemption from motor vehicle tax because she does not own a car. However, that is “highly unusual”. Such an exemption statement is therefore not issued by the Tax and Customs Administration.
With regard to payroll tax, it is important to know whether it concerns private pensions or a government pension. Private pensions are not taxed in the Netherlands, but government pensions are. Without an exemption statement, your pension funds must withhold wage tax. However, if it concerns private pensions, in addition to the national insurance contributions that are not owed, you will also receive a refund of the wage tax that is not due on a declaration.
To also receive a refund of the Zvw contribution, you will have to submit a request to the Tax and Customs Administration/Arnhem office. You can find a clear description of how this works in the following web link. You can also download the required form via this web link:
https://www.belastingdienst.nl/wps/wcm/connect/bldcontentnl/themaoverstijgend/programmas_en_formulieren/verzoek_teruggaaf_inkomensafhankelijke_bijdrage_zvw_buitenland
Dear Lambert,
I actually started to doubt myself a bit, but apparently I don't see it that crazy. Many thanks for your response. I have two pension providers myself: Nationale Nederlanden and Aegon. NN did quite well on its own, but Aegon refuses without an exemption statement. I submitted that application by mail today, but I fear with great fear because question 2 immediately refers to the required Thai tax statement, with the addition (which seems highly irritating and even pedantic to me) that without that Thai statement no willing to submit the application. I have therefore only referred with a pen to the explanation that I am allowed to give and where I write that I am not requesting an exemption from payroll tax, but that I do not wish to pay for the peanut butter that I am not allowed to consume.
Incidentally, another nice one: I still have no response to a letter to the Tax and Customs Administration, the reminder and the complaint about this to the Director General. Nothing, nothing at all, not even an acknowledgment of receipt. That is now with the National Ombudsman (but apart from a confirmation of receipt 3 weeks ago, it remains anxiously silent there too.
Do you have any ideas for that?
Best regards, Paul
Dear Paul,
I already wrote that AEGON is one of the pension providers that constantly refuses to waive the deduction of national insurance contributions and the income-related contribution to the Health Insurance Act, while people fall outside the circle of insured persons when living abroad.
With regard to your application for exemption from withholding payroll tax and healthcare insurance contributions, you have made every effort. Now it's a matter of waiting
What you can still do is to submit a notice of objection to the tax authorities/Heerlen office. You must do so within 6 weeks of receiving a payment from AEGON.
This objection will most likely be rejected, after which you can appeal to the Court of Breda. The notice of appeal must also be submitted within 6 weeks after the rejection of your objection.
I have been doing such a job for a Thai client for over a year and a half now. So that is also a long way to go. Recently (so after more than a year and a half) the Tax and Customs Administration/Heerlen office submitted a statement of defense to the court.
Dear Lambert,
I am very positively touched by your comment. I would like to maintain direct contact with you, maybe we can both benefit from this and perhaps also for the readers of Thailandblog. I would be happy to explain this further via email. My email address is [email protected]. I hope the moderator will allow me to let you know.
I look at my inbox with interest.
Best Regards,
Paul
Dear Paul,
Thank you for your sympathetic response. I have already sent you a message via your email address. Perhaps I will then also “hear” what you have done towards AEGON.
I have now written an entry for Thailand Blog about AEGON's actions and what to do. Perhaps I can incorporate your findings into it.
Regards,
Lammert.
In my earlier response to Paul I wrote AEGON incorrectly. However, that must be ACHMEA.
I am now curious why the Tax and Customs Administration continues to defend itself in court and what that is based on.
Hello Henry,
Apparently you missed the news that the payroll tax exemption has been canceled for all people living abroad since 2015. As far as I understand, the tax authorities have not applied this to many, but they can expect a hefty additional assessment to repay that excess received. Much attention has already been paid to this. So I think your action by the tax authorities is separate from your request.
Best regards. Bz
Received an exemption from payroll tax in 2015 through the Central Appeals Board
I would say perseverance wins
Dear EZ,
Have you lodged an appeal against a rejection by the Tax and Customs Administration/Heerlen office? Then you have probably appealed to the Court of Breda.
Can you say something more about that? On behalf of a client living in Thailand, I also currently have a case against such a rejection. This has been going on for over a year and a half. The Tax and Customs Administration/Heerlen office recently submitted a statement of defense to the court (so after a year and a half!).
Would you mind sending me some information about this via my email address? I would be very grateful.
My email address is [email protected].
Thank you in advance.
As far as I know, it is normal that you pay despite objecting. If you are put in the right, you will receive the paid payroll tax refunded to your account without further ado.
Dear Henry,
I also recently applied for and was granted a waiver, valid until 2025.
If you have filed a tax return in Thailand, you must ask the revenue office for forms RO 21 and RO 22 and submit them to the Dutch tax authorities.
I assume that the excess payroll tax withheld will be refunded. At least that was the case for me. The Dutch tax authorities pass this on to the pension fund. Do indicate the date on which you are applying for the exemption, in your case from the date on which the deduction is now (incorrectly) made.
Success with it.
As I read it, Hennie, your withholding exemption is now expiring and the new exemption has not yet been granted. So there is no more “right of exemption” for a while. As soon as you have proven that you are filing a tax return in Thailand, the exemption will probably be granted. It is always recommended to apply for a new exemption in a timely manner and the last time I did so was in August for an exemption that expired on December 31. Then everything was arranged on time.
Still some ambiguities… you already had an exemption, so you have a private pension? Do you already have state pension, from which the tax credit is now deducted?
It seems that some in this blog are talking about the tax credit (is deducted from the tax), while Hennie is talking about the payroll tax (= tax).
Thank you all for your response.
Still waiting for the report from Heerlen.
I recently received this advice from my Thai lawyer.
Any foreign individual will become a Thai tax resident in any particular calendar year by staying in Thailand for at least 180 days in the calendar year in question. The foreign individual does not even have to get any Thai tax identification to confirm this status, although it is possible for a foreign individual to obtain a tax identification card from a local revenue office if one has to pay personal income tax to Thailand. Having a Thai tax identification does not in any way prove any Thai tax resident status for any non-Thai citizen. Having at least 180 days in your passport in Thailand proves your Thai tax resident status.
So if you can prove (with your passport) that you stay in Thailand for more than 180 days in a calendar year, you are therefore a Tax resident for Thai law. Why Heerlen needs further information from the tax authorities in Thailand regarding tax residency is therefore a mystery to me.
The status of tax resident does not prove that you also pay tax in Thailand, just whether you are obliged to do so.
Having a tax number can also only apply for the year in which it was assigned, because that does not necessarily mean that you have been in Thailand for more than 180 days the following year and would therefore have to pay tax.
The approach of the Dutch tax authorities seems to be that you at least pay tax SOMEWHERE.
That's probably why they're so difficult.
They want to prevent that you do not pay tax in the Netherlands through an exemption, while you do not pay tax in Thailand, simply because you do not register with the Thai tax authorities.
I personally don't find anything wrong with that.
Governments are paid with tax money and infrastructure is paid with tax money.
Everyone has to contribute to that.
It is true what you say, but it is not the responsibility of the Dutch tax authorities to ensure that you pay tax in Thailand. The Dutch tax authorities must ensure that taxpayers pay taxes in the Netherlands and the same applies to the Thai tax authorities, but for Thailand. If they want to cooperate fine, but that should not be passed on to the person, especially if it is not always easy to receive a statement from the Thai tax authorities and / or other cooperation.
Do you really think that the Thai tax authorities are working just as hard to ensure that Thai taxpayers in the Netherlands pay their taxes in the Netherlands? I dare say that the vast majority of countries are doing the same in terms of only ensuring that the tax is paid in their own country and not outside it. As usual, the Netherlands must be the best boy in the class, even at the expense of their own citizens.
I'm actually curious about the exemption from payroll tax if part of your pension was accrued with ABP and later transferred to a private pension fund. Is an exemption from wage tax and national insurance contributions granted on a pro rata basis?
Dear KhunJan,
I assume that your accrued pension with ABP was partly obtained from a government position.
and partly with a private party. If this party is also affiliated with the ABP (which often occurs in education and healthcare), then only the pension accrued during the government function will be levied.
Dear Lambert,
I have not been complete in my question. Part of my pension has indeed been built up from a government position. After this I started working in the private sector and my pension was transferred to an independent pension fund separate from the ABP. So does your answer to my question apply? eg. for your cooperation..
That's right, KhunJan. In this case too, only the pension accrued during the government function is taxed. If you do not know this yourself, ask your pension provider for a breakdown.