Netherlands is an ideal fund domicile due to its stable regulatory environment, strategic location, and robust infrastructure. The Netherlands offers a favorable tax regime, extensive network of tax treaties, and high-quality service providers, making it a prime location for private equity and fund management. Vistra's local expertise and comprehensive services, including fund administration, compliance, and corporate services, ensure efficient and effective fund operations. This makes the Netherlands a preferred choice for fund managers seeking a reliable and efficient domicile.
Explore Fund Structures: (BV) | (NV) | (FGR) | (cooperative) | (CV) | (SICAV) | (REITs)
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Besloten Vennootschap (BV) - Private Limited Liability Company
Fund vehicle description
A BV is a common structure used by private equity and venture capital funds to complete investments in the Netherlands, providing limited liability to its shareholders.
Key Considerations
Flexibility in issuing different classes of shares.
Suitable for both domestic and international investors.
Requires compliance with Dutch corporate regulations.
Tax Implications1
A BV is in principle subject to Dutch corporate income tax (CIT) on its worldwide income. The CIT rates for the year 2024 are 19% on the first €200,000 of taxable income, and 25.8% on the excess. Dividends distributed by a BV are subject to a 15% withholding tax. Additionally, a BV can if it meets the conditions, benefit from the participation exemption, which exempts dividends and capital gains from qualifying subsidiaries from CIT, and may benefit from various international tax treaties.
Naamloze Vennootschap (NV) - Public Limited Liability Company
Fund vehicle description
An NV is often used for larger funds and publicly traded entities, offering limited liability for its shareholders.
Key Considerations
Suitable for listing on stock exchanges.
Higher regulatory requirements compared to a BV.
Attracts a broader range of investors, including institutional investors.
Tax Implications1
Similar to a BV, an NV is subject to CIT on its worldwide income at the same rates (19% on the first €200,000 and 25.8% on the excess). Dividends distributed by an NV are also subject to a 15% withholding tax. The NV structure can if it meets the conditions take advantage of the participation exemption for qualifying subsidiaries and may benefit from various international tax treaties.
Fonds voor Gemene Rekening (FGR) - Mutual Fund
Fund vehicle description
An FGR is a contractual arrangement rather than a legal entity, operating under a fund agreement between the fund manager and investors, providing flexibility.
Key Considerations
Highly flexible and customizable.
Not a separate legal entity, reducing regulatory burden.
Attractive for both retail and institutional investors due to tax transparency.
Tax Implications1
The closed FGR itself is typically not subject to CIT, as it is considered tax-transparent. This means that taxation occurs at the investor level based on their tax status. Income and capital gains generated by the FGR are taxed according to the tax profiles of the individual investors, providing significant flexibility for tax planning.
Coöperatie (Cooperative)
Fund vehicle description
A cooperative can be used as an investment fund vehicle where members have limited liability and profits are distributed among members.
Key Considerations
Can be used to create a tax-efficient structure for international investors.
Members benefit from limited liability.
Requires adherence to cooperative principles and member participation.
Tax Implications1
A cooperative is generally subject to CIT at standard rates. However, profit distributions to members can be exempt from dividend withholding tax if the cooperative meets specific conditions aimed at preventing misuse. This structure is often used to mitigate withholding taxes on profit distributions to foreign investors, leveraging favorable tax treaty treatment.
Commanditaire Vennootschap (CV) - Limited Partnership
Fund vehicle description
A CV consists of general partners with unlimited liability and limited partners with liability limited to their investment, commonly used for private equity and real estate investments.
Key Considerations
Attractive for structuring private equity and real estate investments.
Flexibility in partnership agreements.
Requires careful structuring to ensure tax transparency and compliance.
Tax Implications1
A CV is typically tax-transparent, meaning that the general and limited partners are taxed individually on their share of the partnership's income. The CV itself is not subject to CIT, allowing for flexibility in tax planning and potential tax deferral strategies.
SICAV - Société d'Investissement à Capital Variable
Fund vehicle description
Although originally a Luxembourg vehicle, SICAV structures can also be established in the Netherlands, operating as an open-ended collective investment scheme with variable capital.
Key Considerations
Suitable for open-ended investment schemes.
Flexibility in capital management.
Requires adherence to regulatory standards for investment funds.
Tax Implications1
SICAVs are typically structured to be tax-efficient and may be exempt from CIT and withholding taxes, depending on their specific structure and adherence to regulations. They can benefit from various tax treaties based on their domicile and operational scope.
Real Estate Investment Trusts (REITs) - Fiscale Beleggingsinstelling (FBI)
Fund vehicle description
FBIs are special tax-regime vehicles primarily investing in real estate, providing tax advantages to attract both domestic and international investors.
Key Considerations
Attractive tax regime for real estate investments.
Requires compliance with distribution and investment rules.
Provides significant tax advantages for investors.
Tax Implications1
FBIs are subject to a 0% CIT rate if they meet certain conditions, including the requirement to distribute 100% of their taxable profits to shareholders annually. Dividend distributions from FBIs are subject to a 15% withholding tax, making them a tax-efficient vehicle for real estate investments.
Disclaimer:
1 Above tax parameters are indicative and subject to meeting certain conditions. Vistra recommends obtaining specific tax advise for any structure being selected.
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