In his speech from the throne, King Willem-Alexander announced an ‘unprecedented hefty package of measures of over € 18 billion, mainly for those on low and middle incomes. The measures are covered by higher taxes on profits and assets, among others, sparing small and medium-sized enterprises as far as possible,’ King Willem-Alexander said. Looking at the 2023 Tax Plan as a whole, it appears that SMEs (and the wealthy) will still be hit next year. We briefly list the 10 most important tax proposals and changes for you as an entrepreneur in the real economy:
Employer
1. Increase of minimum wage by at least 10%
The proposed increase in the minimum wage will be brought forward. Instead of the proposed 7.5% increase spread over three years, there will be a one-off increase of at least 10% in 2023. This measure will obviously give minimum wage earners more financial room. The costs will be borne by the employers. The state pension and welfare are also going up, because these benefits are linked to the minimum wage.
2. Increasing the discretionary scope under the work-related costs scheme
The work-related costs scheme allows you, as an employer, to provide and reimburse your staff for certain items free of tax. The discretionary scope in the work-related costs scheme will be increased from 1.7% up to a wage bill of € 400,000 in 2022 to 1.92% up to a wage bill of € 400,000 in 2023. For a wage bill above € 400,000, the discretionary scope is 1.18%. If you exceed the discretionary scope, you will pay 80% tax via the final levy in the payroll records.
3. Higher customary wage
As a director/major shareholder (DGA), you are obliged to grant yourself a customary wage and include it in your PLC’s payroll. The customary wage must, by law, be set at not less than 75% of the wage for the most comparable employment. Or at the highest salary of the employees employed by your PLC, if either of these amounts exceeds € 48,000.
As this wage is difficult to determine, an efficiency margin of 25% applies. This means you can take the most comparable employment and subtract 25%. This margin will be abolished starting in 2023. You may therefore have to allocate yourself a higher salary as a DGA from 2023.
Rates and tax credits
4. Corporate income tax rates
Corporate income tax rates are going up and tax brackets will be reduced. From 1 January 2023, the rate on taxable profit up to € 200,000 will be 19%, and 25.8% on the excess. This means that profits will be taxed at the top 25.8% rate sooner. The reason for the increase is to collect more tax from profitable companies to reduce the burden on citizens and increase purchasing power.
| Corporate income tax | 2022 | 2023 |
|---|---|---|
| Profit up to € 395,000 in 2022 / € 200,000 in 2023 | 15,0% | 19,0% |
| Profit above € 395,000 in 2022 / € 200,000 in 2023 | 25,8% | 25,8% |
5. Income tax rates down and tax credits up
The rate in the lowest bracket will be reduced slightly from 37.07% (2022) to 36.93% (2023). The lowest tax bracket will also be extended to € 73,071 (€ 69,398 in 2022). Tax credits will be increased.
Tarieven inkomstenbelasting 2022 | EN
| Taxable income more than | but not more than | Rate in 2023 | |
|---|---|---|---|
| 1st bracket | - | € 73.071 | 36,93% |
| 2nd bracket | € 73.072 | - | 49,50% |
6. Two rates for substantial interest
If you own more than 5% of the shares, profit-sharing certificates or voting rights in a company, you hold a substantial interest. The income you get from this interest (such as dividend) is taxed in income tax box 2. The rate is currently 26.9%.
The government plans to introduce two brackets in box 2 from 2024, which will be 24.5% (up to € 67,000) and 31% on the excess.
In 2023, the rate for box 2 remains the same as the rate in 2022, at 26.9%.
7. Tax rate for box 3
The rate in box 3 will be increased in stages. In 2023, the rate will be 32% (currently 31%). In 2024 and 2025, the box 3 rate will go up by 1%, to 33% and 34% respectively.
To spare small savers, the tax-free capital will be increased from € 50,650 to € 57,000 from 2023.
Finally, as a result of the Supreme Court’s Christmas ruling and the legal redress required as a result, the tax base in box 3 will be adjusted. The Tax & Customs Administration will base this on the actual distribution of your assets across three asset groups:
- Bank balances
- Other assets (including investments and real estate)
- Liabilities
Housing market
8. Increase in transfer tax for businesses and investors
The transfer tax for real estate not qualifying as owner-occupied property (in other words, investment properties) will rise from 8% to 10.4%. On balance, businesses and investors and holiday home buyers or landlords will pay more transfer tax as a result.
9. Increase in the value with vacant possession ratio
The value with vacant possession ratio is a rent-related factor for calculating the value of a fully or partially let property subject to rent protection for the tenant. This will be increased with effect from 1 January 2023. This will increase the value of a rented property in box 3, so the landlord will have to pay more tax in box 3. This change also affects gift and inheritance tax.
There are two further changes:
- Temporary leases will be excluded from the application of the value with vacant possession ratio from 1 January 2023.
- For leases to related parties (such as a son or daughter), the possibility of applying the value with vacant possession ratio will be removed.
Note: The value with vacant possession ratio does not apply to holiday homes and non-residential properties.
10. Phasing out and abolition of tax-free gift for owner-occupied housing
The exemption for a gift to purchase an owner-occupied home (known in Dutch as the ‘jubelton’) will be completely abolished from 1 January 2024. From 1 January 2023, the lump-sum exemption will already be reduced to € 28,947. This amount is the same as the increased lump-sum exemption applying to gifts to children who can spend it as they wish. The current maximum exempt amount is € 106,671.
What does the Tax Plan not yet include?
Alongside this purchasing power package, the government has announced a price cap for electricity and/or gas up to a certain level of use. And that it will help distressed companies within the energy-intensive SME sector to strengthen their liquidity and improve their sustainability. It is still unclear what these plans will look like.
The plans do not include any changes regarding the business succession facility. The government’s view on this scheme will follow this autumn. An adjustment is expected in 2024.
