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Netherlands: Interest deduction denied under fraud provision of corporate income tax law (Supreme Court decision)

A Supreme Court decision concerning whether interest deduction may be denied under fraud provision of corporate income tax law

March 27, 2024

The Dutch Supreme Court on 22 March 2024 held that an interest deduction may be denied under the fraud provision of Section 10a Corporate Income Tax Act 1969 if there is a series of transactions between affiliated entities aimed at avoiding association for purposes of those rules.

The court also held, however, that transaction costs for borrowing funds may be deducted, unless they constitute pre-paid interest.

Read a March 2024 report prepared by the KPMG member firm in the Netherlands

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