‘s-Hertogenbosch, The Netherlands

M&A and Dutch tax: acquisition of shares by a Dutch company

By Edward Hendrickx and Carijn van Helvoirt-Franssen, EJP Accountants & Adviseurs

When a Dutch company acquires shares of another company, there are corporate income tax topics which should be considered. Please find below a non-exhaustive overview.

General interest deduction

Dutch tax law has a general interest deduction limitation. As a consequence, when the interest exceeds EUR 1 million or, if higher, 30% of the profit defined according this provision, the excess part of the interest is non-deductible.

Financing the acquisition by a group loan

There is a specific provision for the acquisition of shares financed by a group loan. When the acquisition is financed by a group loan and there is no back-to-back external loan, under certain circumstances the interest on the group loan is non-deductible.

Loss relief

If Target is a Dutch tax resident with compensable losses, the main rule is that Target can offset these losses with its taxable profits from the previous year as well as from the six years following the loss year. For the sake of completeness, please note that the Dutch government announced changes in its loss relief legislation (we will not elaborate on this in this article).

However, if Target has compensable losses and there is a change of (indirect) ownership of Target exceeding 33.33%, for loss compensation there are additional requirements that apply regarding the extent of the activities in the acquisition year compared to the activities in the loss year.

Participation exemption

When the Dutch company’s interest in Target exceeds 5%, Target’s profits are, in principle, exempt from Dutch tax. In addition to the tax exemption on Target’s profits, the costs of acquiring (and selling) Target are tax exempt and therefore non-deductible. Examples of these costs include costs for notarial deeds, advisory services relating the acquisition, etc.

As already indicated, please note that this list is non-exhaustive and the provisions described are generic.

Depending on the case, there are more relevant tax related topics. Therefore we advise you to consult a Dutch tax advisor in this matter.


Edward Hendrickx

Edward Hendrickx

GGI member firm
EJP Accountants & Adviseurs
Auditing & Accounting,Corporate Finance, Tax
‘s-Hertogenbosch, The Netherlands
T: +31 73 850 72 80
E: This email address is being protected from spambots. You need JavaScript enabled to view it.
W: ejp.nl

EJP Accountants & Adviseurs are auditors, advisers, and challengers. Their 40 auditors and international tax lawyers have a wide range of expertise. Their main fields of expertise are Dutch corporate and personal income tax, international taxation, Dutch royalty, interest and dividend withholding tax, estate planning, and wage tax. They have an AFM license to perform audits for larger midsize companies.

Edward Hendrickx is EJP’s founder, partner & tax specialist. He specialises in international tax advice, mergers & acquisitions, and consultancy on entrepreneurship, and for larger SME clients.
Carijn van Helvoirt-Franssen

Carijn van Helvoirt-Franssen

GGI member firm
EJP Accountants & Adviseurs
Auditing & Accounting,Corporate Finance, Tax
‘s-Hertogenbosch, The Netherlands
T: +31 73 850 72 80
E: This email address is being protected from spambots. You need JavaScript enabled to view it.
W: ejp.nl

Carijn van Helvoirt-Franssen completed a master’s degree in fiscal economics at Tilburg University in 2014 and has been part of the EJP team since 2020. As an all-round tax specialist, she focuses on providing tax advice to companies and their directors and major shareholders.


Published: M & A Newsletter, No. 01 Autumn 2021 l Photo: Mayk van Houtert - stock.adobe.com

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