Voluntary disclosure

In the Dutch tax legislation the possibility was created for taxpayers who intentionally filed incorrect returns in the past to renege on these earlier inaccuracies. On the basis of this so called ‘voluntary disclosure scheme’ errors can be remedied without a subsequent criminal case for tax fraud. The payable tax will still need to be paid plus interest on tax. Moreover, since 1 January 2010 – with an interim penalty-free period between 2 September 2013 and 1 July 2014 – (modest) penalties have been imposed.

Voluntary disclosures must, according to the statutory provisions, take place before the taxpayer knows or should within reason assume that the inspector is or will be familiar with the incorrectness or inaccuracy. In other words, once the Dutch Fiscal Intelligence and Investigation Service (FIOD) stands at the doorstep, the Dutch Tax Authorities sent a letter of questions or sought contact by telephone or announced an investigation it is certainly too late.

In this context it is important that shortly many countries (also including Switzerland, Luxembourg, and Austria) will automatically exchange bank information with the Netherlands. More important is that foreign banks want to take leave from their customers who did not declare bank balances. They require evidence that a voluntary disclosure took place or that the balances were included in the declarations in the Netherlands. This ‘compels’ certain taxpayers to proceed with a voluntary disclosure.

Finally, tax consultants and accountants are subject to a notification requirement. With regard to a voluntary disclosure conversation lawyers can rely on the professional privilege and are not subject to this kind of notification requirement.

In the recent past De Bont Advocaten assisted many taxpayers in voluntary disclosure proceedings.