Box 3 actual yield

Box 3 actual yield

In June 2024, the Supreme Court ruled that the ‘actual yield’ in Box 3 must be taxed if it is lower than the fictitious yield on assets. In several rulings, the Supreme Court also clarified how that actual yield should be defined.

The Supreme Court does not apply an economic approach but has instead tried to establish a definition as closely as possible within the framework of the statutory Box 3 system. According to the Supreme Court, actual yield includes both direct and indirect yield. Direct yield includes items such as interest, dividends, and rent. Indirect yield encompasses both realized and unrealized changes in the value of assets, both positive and negative. Costs are not deductible, except for interest on loans (i.e. negative yield). There are still some uncertainties, however, such as regarding real estate, which will likely be addressed in future case law.

Form Reporting actual yield (OWR: ‘Opgaaf werkelijk rendement’)

The Dutch tax authorities are developing a new form to report the actual yield on assets. This form, expected to be available in June 2025, will be called the ‘Reporting actual yield’ (in Dutch ‘Opgaaf werkelijk rendement’, abbreviated OWR). If it appears that the actual yield is lower than the fictitious yield as per the legislation from 2017 onwards or the so-called notional savings variant (‘forfaitaire spaarvariant’ in Dutch), the form can be submitted. This will make taxpayers eligible for (additional) legal restitution. The Dutch tax authorities will send letters to taxpayers who may qualify for reassessment of their tax assessment based on actual yield.

Different box 3 calculation methods

Before the rulings in June 2024, the Supreme Court had already ruled in the so-called Christmas ruling (‘Kerstarrest’ in Dutch) by the end of 2021 that the system from 2017 onward was not permissible in all cases, particularly for savers. Taxpayers could qualify for a refund (legal restitution). The June 2024 rulings went a step further, concluding that the legal restitution provided (and thereby also the legislation from 2023 onward) was also insufficient, especially for non-savers.

2017 – 2022
The above means that for the years 2017 through 2022, there are effectively three calculation methods:

• The statutory calculation method based on two fictitious yield percentages and a notional asset mix, which depends on the amount of net wealth;
• The calculation based on legal restitution following that ‘Kerstarrest’ (notional savings variant);
• The calculation of the actual yield according to the Supreme Court rulings of June 2024.

For the years 2021 and 2022, the most favorable of the three methods will apply. For prior years, this depends on whether you previously filed an objection and whether the assessments are final and binding.

2023 and beyond
For the years from 2023 onward, two calculation methods apply: the statutory method and the calculation based on actual yield.

For which years can the form Reporting actual yield (OWR) be submitted?

Below is an overview of each year, specifying whether and under what conditions the Reporting actual yield can be submitted for past years.

2017 and 2018
If the assessment is not yet final. Or if a final assessment was received on or after December 24, 2021, and a request for an ex officio reduction was filed within five years (by the end of 2022 or 2023, respectively).

2019
If the assessment is not yet final. Or if a final assessment was received on or after December 24, 2021, and a request for an ex officio reduction is submitted by December 31, 2024. For 2019, the Dutch tax authorities have sent a separate letter with a form for an ex officio reduction request in certain cases.

2020
If the assessment is not yet final. Or if a final assessment was received on or after December 24, 2021, provided a request for an ex officio reduction is submitted by the end of 2025.

2021 – 2023
If a tax return has been filed and/or a final assessment has already been issued.

Objection or ex officio request for reduction?

At a certain point, the Dutch tax authorities stopped issuing final assessments with Box 3 tax for the years 2021 and beyond for those who might qualify for additional legal restitution. If a final assessment has nonetheless already been issued and the objection period has expired, an ex officio reduction request can still be used.

The Dutch tax authorities have announced plans to issue final income tax assessments for 2021 later this year (2024). In exceptional cases, a final assessment for later years may also be issued.

Once a final assessment is issued, an objection can be filed within six weeks. Since there is still some uncertainty in certain cases regarding how actual yield should be calculated, we advise filing an objection against final assessments that are not yet final. This recommendation holds even though an ex officio reduction request can be submitted after the objection period, as filing an objection offers a better legal position, including the right to appeal and go to court. Furthermore, filing an objection within the objection period preserves rights in the event of new Supreme Court rulings on Box 3.Filing an objection against a non-final assessment is simple: log in to MijnBelastingdienst with DigiD, go to Objection Income Tax Assessment, enter the assessment number, and select Box 3 Objection and Request for Reduction as the reason.

More information?

For more information or assistance with filing an objection or submitting an ex officio reduction request, please contact our tax team at taxreturns@limes-int.com.