11.1 General information

Members of diplomatic missions and consular posts may enjoy certain fiscal privileges. These privileges are granted in the interests of the diplomatic missions or consular posts, so that they can function efficiently, and not for the personal benefit of their staff. For an overview of all tax exemptions please refer to Annex H.

Staff members with Dutch nationality or permanent residents do not enjoy the tax exemptions mentioned in the other sections of this chapter.

The Tax and Customs Administration (Belastingdienst) has a special desk for international organisations, diplomatic missions and consular posts: Team IFB (Team Internationale Fiscale Behandeling).

Team IFB can be contacted by post (Postbus 30509, 2500 GM The Hague) or by email. For questions about income tax, email Haaglanden.CB_IFB@belastingdienst.nl. For questions about VAT and excise duties, email IFB.Diplomatieke.Privileges@belastingdienst.nl. The address for visitors is: Prinses Beatrixlaan 512, 2595 BL The Hague.

The Ministry of Finance (Ministerie van Financiën) can be contacted as follows: Postbus 20201, 2500 EE The Hague
Tel. +31 (0)70 342 8000
Website: https://www.government.nl/ministries/ministry-of-finance


11.2 Income tax

Under article 34 of the VCDR6 and article 39 of the VCCR7, staff of diplomatic missions and consular officers are exempt from Dutch income tax in relation to earnings from their diplomatic or consular duties. This means that they will be treated as non-resident taxpayers. They will only be taxed on income not related to their official activities in the Netherlands.

11.3 Conditions for exemption

There are two packages of fiscal privileges (A and B) which the Netherlands accords to diplomatic missions and consular posts. The difference between these packages concerns the exemption from import duties, VAT, and the quota with regard to tax-free items.
Package B covers exemptions under the Vienna Conventions and provides only for limited exemptions on goods for the personal use of members of diplomatic missions and consular posts.

Package A, which is granted on the basis of reciprocity only, has the same exemptions as package B, as well as additional privileges, such as exemption from VAT and increased quotas for personal use (see Annex F for further details). In addition, there are quotas for alcoholic beverages and fuel for tax-exempted motor vehicles, as indicated in Annex G. These are annual quotas, unless otherwise stipulated. An overview of other tax exemptions accompanying packages A and B can be found in Annex H.


11.4 Value added tax

11.4.1 Conditions and exemption by way of refund

Diplomatic missions and consular posts that fall under package A
Diplomatic missions and consular posts that fall under package A will be exempt from VAT paid on the supply of goods (except tobacco) and services intended for their official use. The exemption from VAT only applies to invoices higher than €225 excluding VAT. If separate goods or services amount to more than €225 (excl. VAT) on the same invoice, this invoice may be approved for a VAT refund. When buying on account, the invoice may cover purchases from the same supplier within one calendar quarter. No exemption will be granted if purchases made by different persons, diplomatic missions or consular posts have been added together on the same invoice.

Diplomatic missions and consular posts that fall under package B and consular posts headed by an honorary consular officer
Exemption from VAT may be obtained for:
the supply of movable property and provision of services for the purpose of renovating, restoring and maintaining (excluding cleaning) official buildings, except for the residence of the honorary consul;

• the renting of immovable property intended for official use;
• the supply to a diplomatic mission or a consular post headed by a career consular officer of gas, water, electricity and domestic fuel intended for official use, including use by the head of the mission;
• the provision of security, cleaning and telecommunication services for the benefit of the official functions of a diplomatic mission or a consular post headed by a career consular officer, including the protection of members of the mission or post.

The exemption from VAT (omzetbelasting/BTW) enjoyed by honorary consular posts is limited to the following transactions:

• the purchase of immovable property, and associated rights in rem, intended for the post’s official use, including immovable property and associated rights in rem intended for accommodating the post’s staff, with the exception of honorary consuls;
• the purchase of goods and services intended for the construction, renovation, repair and maintenance, not including cleaning, of the post’s official buildings, with the exception of the honorary consul’s home;
• the letting to the post of immovable property intended for official use.

Staff of diplomatic missions and consular posts that fall under package A
Movable property intended for personal use (other than motor vehicles, food and (alcoholic) beverages) may be exempted from VAT. The exemption from VAT only applies to invoices higher than € 225 excluding VAT. If separate goods or services amount to more than € 225 (excl. VAT) on the same invoice, this invoice may be approved for a VAT refund. When buying on account, the invoice may cover purchases from the same supplier within one calendar quarter. No exemption will be granted if purchases made by different persons, diplomatic missions or consular posts have been added together on the same invoice.

The exemption does not apply to goods supplied by hotels, restaurants, cafés, catering organisations and related bodies. Furthermore, immovable property and services (BTW voor diensten) are excluded from the exemption. Exemption from VAT is not granted in respect of goods which are used for business purposes, or which are sold, given away, hired out or in any other way put at the disposal of third parties by the person concerned.

Procedure
The following procedure applies to diplomatic missions and consular posts eligible for exemptions from VAT on the purchase of goods and services intended for official use and the purchase of goods (except foodstuffs or beverages) intended for personal use by their staff members.

As a rule, exemption from VAT takes the form of a refund of tax paid following the submission of an application for a refund.

One application should be submitted each quarter. The refund will only be granted if the goods or services in question are recorded using form OB 100, and if the application also includes proof of payment and dated invoices which clearly state:

• the date on which the transaction subject to VAT took place;
• the name and address of the business that supplied the goods or service;
• the name and address of the person to whom the goods or service were supplied;
• a clear description of the goods or service;
• the quantity of the goods supplied;
• the amount paid;
• the amount of tax due on the supply of goods or services.

Proof of payment is a copy of a bank statement showing the bank account number, the name of the account holder and the payment. Transaction overviews will not be accepted as a proof of payment because they do not meet the necessary requirements.

Receipts are not generally considered invoices because they do not meet the requirements set out above. A receipt may be accepted instead of an invoice, however, if the goods are clearly described and a copy of a bank statement is attached showing the bank account number, the name of the account holder and the payment.

The invoice amount must be at least €225 excluding VAT in order to qualify for a refund. Applications for refunds by diplomatic missions and consular posts must be signed by or on behalf of the head of mission. Applications for refunds by administrative, technical or service staff members must be signed both by the applicant and by or on behalf of the head of mission. Applications for refunds by diplomatic staff and consular officers must be signed by the applicant.

Questions about customs rules and VAT refunds, refunds of excise duties and related taxes on engine fuel can be addressed to Team IFB by sending an email to IFB.Diplomatieke.Privileges@belastingdienst.nl.


11.4.2 Advance exemption

Subject to certain conditions, exemption from VAT on goods and services may also be granted in advance to diplomatic missions and consular posts for large purchases. The amount invoiced must be at least €35,000. Advance exemption from VAT can be requested by submitting a certificate.

Certificate
The certificate is the ‘VAT and/or Excise Duty Exemption Certificate’ (article 151 of Directive 2006/112/EC and article 13 of Directive 2008/118/EC). The certificate may be in either Dutch or English. A separate certificate is needed for each purchase. The certificate can be obtained from Team IFB. The diplomatic mission or consular post must submit a written request to Team IFB in advance, together with the following:

1. the completed certificate; and
2. the order form, invoice and draft contract, together with information proving that the total amount of the taxable supply of goods or services is at least € 35,000 (excluding VAT).

If the application is approved, the certificate will be stamped by Team IFB. The completed and stamped certificate must be submitted to the supplier (before the transaction takes place), who should keep it in its records as proof that no VAT needs to be charged. The supplier may then provide the goods or services free of VAT, applying a 0% VAT rate on the invoice. The certificate can also facilitate exemption from VAT on purchases in other EU member states.

If you have any questions or wish to request any of the relevant forms please contact Team IFB by sending an email to IFB.Diplomatieke.Privileges@belastingdienst.nl.


11.4.3 Purchasing outside the Netherlands but within the EU

For transactions in other EU member states, a certificate is needed for each transaction in the other EU member state in order to prove to the supplier and to the tax authorities of the state in question that entitlement to exemption from VAT exists. The tax authorities of the EU member state in which the supplier is located decide whether a diplomatic mission or consular post is eligible for a tax exemption or a tax refund in that member state. Certificates for VAT exemption can be obtained from Team IFB.


11.5 Importing goods into the Netherlands

Subject to certain conditions, those eligible for this tax exemption may import goods originating from outside the EU duty-free.

Procedures for the import of goods vary according to whether the goods are to be imported for personal or official use and whether the goods originate from within or outside the EU.


11.5.1 Import of household effects (for personal use)

When moving to the Netherlands from a non-EU country, personal household goods are eligible for import without paying import duties. Exemption is granted in advance by Team IFB through the D39 form. In order to be eligible for the tax exemptions on importing personal goods, all the following conditions must be met:

• you are moving from a country outside the European Union to the Netherlands and will be living in the Netherlands or another EU country;
• you are thus moving from your original place of residence to the European Union;
• you have lived outside the European Union for at least 12 consecutive months immediately preceding your relocation;
• you have owned and used the goods for at least six months prior to moving to the Netherlands; • you have used the goods and will be using them again;
• you are importing the goods within 12 months of taking up employment in the Netherlands or another EU country;
• you will not loan, pledge, sell, lease out or transfer the goods within 12 months of the date on which they were imported.

Please note that the following goods are not considered part of household effects and are therefore not eligible for exemption:

• alcoholic beverages or any other item that contains alcohol;
• tobacco and any other item that contains tobacco;
• company vehicles;
• non-portable materials for professional use.

In order to be exempted from paying import duties on household effects, all conditions set by the tax authorities must be met.

The website of the Tax and Customs Administration may be consulted in order to obtain further information on this matter (please refer to the general information on Moving to the Netherlands). For more specific information, you may also contact Team IFB by emailing IFB.Diplomatieke.Privileges@belastingdienst.nl.


11.5.2 Taxes and duties on imported goods originating outside the EU

The procedure
Subject to certain conditions (i.e. official use or personal use by eligible personnel) and restrictions (i.e. quotas), those eligible for this tax exemption may import goods (including alcohol) originating from outside the EU duty-free by using the Douane 39 (D39) form.

The relevant conditions will apply to both tax-exempt imports and tax-exempt purchases at a tax warehouse (accijnsgoederenplaats, AGP). To calculate the quotas, both imports and AGP purchases will be totalled. Please contact Team IFB for the relevant form.

The application must be made by the head of the diplomatic mission or consular post or their authorised representative. Their name and signature must be recorded at the Protocol Department in advance. They must complete and sign the forms and forward them to Team IFB. Team IFB will retain the office copy and, after endorsement, return the other copies to the applicant.

As a certified/approved D39 form is only valid for 14 days, the goods must reach their destination within this period. Upon arrival of the goods, the recipient must acknowledge receipt using the back of the customs copy of the D39 form. The form must then be signed as approved by or on behalf of the head of the diplomatic mission or consular post.

NB: Team IFB will only process a new application if the applicant has returned the previous copy. Exempt goods may not be loaned, pledged, hired out, transferred or used in a manner or for purposes not covered by the exemption.

Any application submitted by a diplomatic mission or consular post which does not meet the stipulated conditions and requirements cannot be processed by Team IFB. Please contact Team IFB to request the relevant forms.

For questions concerning form D39 and tax-free importation of goods, please contact Team IFB by emailing IFB.Diplomatieke.Privileges@belastingdienst.nl.


11.6 Transfer tax on immovable property

Exemption from transfer tax (overdrachtsbelasting) can be granted in respect of the acquisition of immovable property situated in the Netherlands by a foreign state.

If the immovable property is intended to accommodate the diplomatic mission or consular post of that foreign state or its staff members (with the exception of honorary consular officers), the exemption is granted in respect of rights in rem to such property. These include apartment rights and leasehold rights.

Exemptions can only be obtained through the Protocol Department of the Ministry of Foreign Affairs, by sending a Note Verbale and submitting a deed of conveyance. Diplomatic missions and consular posts that approach Team IFB directly to request exemption from transfer tax are redirected to the Protocol Department of the Ministry of Foreign Affairs.

If the application for exemption is received at least six weeks before the date of the property’s transfer, the Ministry of Finance can give the notary concerned permission to apply the zero rate. Otherwise, the exemption will be granted in the form of a refund.

In some cases, VAT, rather than transfer tax, is payable on the purchase of official immovable property. Here too, advance exemption may be obtained if a request is submitted to the Protocol Department at least six weeks in advance. Otherwise, the exemption will be granted in the form of a refund.


11.7 Motor vehicles

11.7.1 Motor vehicle tax (MRB)

Motor vehicles intended for official use by the diplomatic mission or consular post (i.e. official cars) are exempt from MRB (motorrijtuigenbelasting).

Staff of a diplomatic mission or consular post may be exempted from motor vehicle tax on vehicles intended for personal use (including use by their dependants). Exemption from motor vehicle tax is granted on the condition that the vehicles concerned have been issued with special registration plates (bearing the codes CD, BN or GN); see chapter 12 (‘Cars’). Administrative, technical and service staff are exempt from motor vehicle tax for 10 years, starting from when they first began working for the organisation in the Netherlands. This 10-year limit does not apply to higher ranking staff with AD status.

11.7.2 Car and motorcycle tax (BPM)

Exemption from BPM (belasting op personenauto’s en motorrijwielen) is granted in respect of motor vehicles intended for official use by the diplomatic mission or consular post (i.e. official cars). These vehicles need to be bought, paid for and thus owned by the mission or post. Exemption from BPM, VAT and, if applicable, customs duties, is granted on the condition that the vehicle has CD/BN/GN registration plates and on the basis of reciprocity.

Members of a diplomatic mission or consular post may be exempted from BPM, VAT and, if applicable, customs duties on one or two vehicles intended for personal use. Administrative, technical and service staff are exempt from BPM, VAT and, if applicable, customs duties, for 10 years, starting from when they first began working for the organisation in the Netherlands. This 10-year limit does not apply to higher ranking staff with AD status.

For both official and personal use, the exemption from BPM, VAT and, if applicable, customs duties, ends when the vehicle is sold, leased, hired out, pledged or transferred free of charge or in return for payment. Using the vehicle or causing it to be used in a manner or for purposes not covered by the exemption is prohibited.

Please note that taxes already paid in connection with ordinary Dutch registration plates will not be refunded. The exemption from taxes on the purchase of motor vehicles is always granted in advance with a D39 form. No refund of paid taxes is granted after the purchase has taken place. Taxes paid on the purchase of second-hand motor vehicles are also not eligible for refund.

11.7.3 Excise duties on motor vehicle fuel

Exemption from excise duties on motor vehicle fuel is granted in respect of motor vehicles intended for official use by the diplomatic mission or consular post (i.e. official cars), and for personal use by eligible staff. This exemption is granted only for motor vehicles with special registration plates on the basis of reciprocity. Administrative, technical and service staff are exempt from excise duties for 10 years, starting from when they first began working for the organisation in the Netherlands. This 10-year limit does not apply to higher ranking staff with AD status.


11.8 Energy tax

If exemption from VAT is granted for the supply of natural gas or electricity intended for official use by a diplomatic mission or consular post, exemption from energy tax is also granted. If the mission or post is responsible for staff accommodation and the associated costs, these costs will also be considered to be costs relating to official use. The exemption can be granted directly through the VAT and/or Excise Duty Exemption Certificate Directive 2006/112/EC. A filled in certificate must be sent to Team IFB. Team IFB will certify the certificate and return it to the diplomatic mission. In order to receive the direct exemption, diplomatic missions must provide its supplier with the certified certificate. Instead of being directly exempted beforehand, diplomatic missions also have the option to request a refund of tax already paid. A request thereto can be submitted together with the request for the VAT refund using the OB 100 form.

This request must be submitted to Team IFB within 13 weeks of dispatch of the final invoice by the energy company. The refund application should be combined with the application for a VAT refund in respect of the energy company’s final invoice.

Diplomatic missions and consular posts are also exempt from the renewable energy surcharge (a supplementary levy on the energy tax, ODE) which is included in the energy company’s invoice. It will be exempted on the basis of the application mentioned above.


11.9 Municipal taxes

In the Netherlands, there are two types of ‘municipal taxes’: taxes on the one hand and charges for services rendered on the other. Diplomatic missions and consular posts and their staff members are entitled to exemption from certain municipal taxes, depending on their status. This does not include exemption from charges for services rendered (see next paragraphs).

11.9.1 Taxes

Exemption is granted only from municipal taxes relating to the official activities of the mission or post and personal use by staff members including their dependants. The term ‘official activities’ includes providing accommodation for staff. Only staff who are neither nationals nor considered to be permanent residents of the Netherlands are eligible for exemption. In granting exemptions, account may be taken of reciprocity.

Exemptions can be granted from payment of the following municipal taxes:

• property tax on property owned by the mission or post and the head of mission or head of post (onroerende-zaakbelasting, OZB);
• municipal tax on second homes (forensenbelasting);
• dog licences (hondenbelasting);
• tax for installations on public land or water (precariobelasting).

If faced with an invoice for municipal taxes despite an exemption, an objection can be lodged at the municipality within six weeks of the date of the assessment. The Municipality can also be contacted for any other questions about these taxes. Municipal taxes do not fall under Team IFB’s remit.

11.9.2 Charges for services rendered

It should be noted that no exemptions are granted on charges levied for specific services rendered. No exemption is therefore granted in respect of: administrative charges (leges), water treatment charges (zuiveringsheffing, see paragraph below), betterment levy (baatbelasting), sewerage charges (rioolheffing), waste disposal charges (afvalstoffenheffing) and waste collection charges (reinigingsrechten). An example of a betterment levy is a charge for the construction of a new sewerage system to which the property in question is connected. This is a municipal charge for a specific service rendered.

Water authority charges
These charges consist of:

• Water authority charges paid by the owner of the premises (watersysteemheffing eigenaar): exemption is only granted to diplomatic missions and consular posts and the head of mission or head of post, unless the property is a second home.
• Water authority charges paid by the occupier (resident) (watersysteemheffing ingezetenen): exemption is granted to diplomatic missions and consular posts as well as to the head of mission or head of post, the diplomatic agents, consular officers, and administrative and technical staff of diplomatic missions and consular posts, unless they are permanently resident in the Netherlands or have Dutch nationality.
• Water treatment charges, wastewater (zuiveringsheffing): the water authority tax for the treatment of wastewater (zuiveringsheffing) has to be paid by everyone residing in a particular district. Despite the wording, this levy concerns a charge – not a tax – for a specific service rendered. Hence there are no exemptions.

11.9.3 Delivery of tap water

Diplomatic missions and consular posts eligible for exemption from VAT are also exempted from tax on the delivery of tap water for official purposes. This exemption can be granted directly through the VAT and/or Excise Duty Exemption Certificate Directive 2006/112/EC. A filled in certificate must be sent to Team IFB of the Tax and Customs Administration. Team IFB will certify the certificate and return it to the diplomatic mission. In order to receive the direct exemption, diplomatic missions must provide their supplier with the certified certificate.

Instead of being directly exempted beforehand, diplomatic missions also have the option to request a refund of tax already paid. A request thereto can be submitted together with the request for the VAT refund using the OB 100 form. An application for a refund of tax paid on tap water must be submitted to Team IFB within 13 weeks of the dispatch of the final invoice of the water company

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