Ireland, Netherlands tax treaty enters into force

On February 29, 2020, a new tax treaty between the Netherlands and Ireland entered into force.

The treaty was signed on June 13, 2019.

The treaty provides for a dividend withholding tax rate of 15% in general cases. Dividends would, however, be exempt if the beneficial owner holds directly at least 10% of the capital of the company paying the dividends throughout a 365-day period.

Interest and royalty payments would be exempt.

Gains derived by a resident of a Contracting State from the alienation of unlisted shares deriving more than 75% of their value from immovable property situated in the other Contracting State (at any time during the 365 days preceding the alienation) may be taxed in the other Contracting State. However, such gains would be taxable only in the first-mentioned State where:

• the resident owned less than 50% of the shares or other comparable interests prior to the first alienation;
• the gains are derived in the course of a corporate reorganization, amalgamation, division or similar transaction; or
• the resident is a pension fund, provided that the gains are not derived from the carrying on of a business, directly or indirectly by that pension fund.

​The new treaty would apply from January 1, 2021.

See Ireland-Netherlands Tax Treaty