Emigration of an enterpeneur (DGA) from the Netherlands: Tax Considerations and Opportunities

The emigration of a director-major shareholder (DGA) from the Netherlands is a complex and impactful fiscal event. When a DGA relocates abroad, the Dutch tax authorities treat this as a deemed disposal of the substantial interest in the company, triggering a capital gains tax under Box 2 of the Dutch personal income tax system. This taxation is based on the market value of the shares at the moment of emigration. Although the tax is not immediately collected, a protective or 'conserverende' assessment is imposed, which becomes payable upon events such as a dividend distribution, sale of shares, or disqualification from the deferral regime.

From 2023 onwards, the DGA is also subject to the anti-abuse legislation under the Excessive Borrowing Act. Under this law, any debts to their own company exceeding EUR 500,000 are taxed as deemed dividend income. While this provision does not automatically apply upon emigration, the size and structure of such debts can significantly impact the inviolability of the deferral granted on the deemed capital gain. If the debt is considered non-businesslike or becomes uncollectible, the Dutch tax authorities may still impose immediate taxation.

It is therefore crucial to consider several preparatory actions: repaying shareholder loans, distributing dividends while still a resident (to benefit from Dutch treaty relief), valuing the shares independently to avoid disputes, and reviewing the target country’s treaty protections and enforcement cooperation. Especially for DGA’s emigrating to low-tax jurisdictions or civil law countries with differing views on shareholder rights, an integrated fiscal strategy is indispensable.