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Tax Deductions for Properties in the Netherlands

Tax Deductions for Properties in the Netherlands

The Dutch authorities offer many tax advantages under the form of deductions to individuals and companies. Both categories of taxpayers can use these deductions for reducing many of the costs related to their maintenance. One of the most important tax deductions offered by the authorities in the Netherlands is related to the purchase of a property.

Our company formation agents in the Netherlands have prepared a small guide related to the tax deductions available for those interested in acquiring real estate in this country.

Types of costs associated with buying a Dutch property

There are 3 types of costs related to the purchase of real estate in the Netherlands:

  • –          the costs which can be deducted upon the purchase of the property and which will be deducted one time only;
  • –          the annual maintenance costs which will be deducted on a yearly basis;
  • –          the non-deductible costs, such as the payments related to the transfer tax and renovations on the building.

Additionally, Dutch homeowners must also pay attention to the local taxes related to owning a home in this country. We remind investors about our accounting services available in the Netherlands.

What are the costs which can be deducted when buying a Dutch property?

In the categories of deductible costs associated with buying real estate in the Netherlands, we mention the following:

  • –          the valuation costs associated with the mortgage of a property which is deducted once;
  • –          the notary costs for drafting the mortgage agreement which is also deducted once;
  • –          the commission paid to the bank upon obtaining the mortgage – another one-time deduction;
  • –          the costs associated with the National Mortgage Guarantee which can also be deducted one time;
  • –          in case of a mortgage contracted for 30 years, the interest related to it can be deducted on a yearly basis;
  • –          any interest related to loans contracted for the house can also be deducted annually.

In case the buyer wants to repay the mortgage earlier than the established period, he or she will be imposed with a fine which can also be deducted.

The 30% ruling for foreigners buying real estate in the Netherlands can help them obtain a mortgage, so do not hesitate to contact us for more information on the tax advantages as a foreign citizen.