TaxCorporate TaxWithholding tax hammered in ECJ

Withholding tax hammered in ECJ

UK pension funds to make hundreds of millions pounds in claims following a European court ruling today

The Dutch taxman could be forced to pay out hundreds of millions of pounds to
UK pension funds following a tax case in the European Court of Justice.

In the case, known as Amurta, the courts ruled that the Dutch government
could not charge withholding tax on non-residents while letting Dutch residents
receive dividends tax-free.

Experts suggest that the ruling will apply across Europe, and pension funds
could be the biggest beneficiaries.

The biggest winners from this case and a similar case, Denkavit, would be
pension and investment funds, with at least 500m Euros (£348m) in claims likely
to emanate from UK funds, according to Jonathan Bridges of KPMG’s international
corporate tax team.

‘We would estimate that claims relating to today’s case must already exceed
EUR500m from UK funds and are in the region of EUR400m from German funds. The
decision closely follows the Denkavit decision of last year which struck down
the French withholding tax rules.’

Further reading:

EU warns of legislation on tax
co-ordination

Treasury steels itself for massive
tax hit from ECJ

Funds could save millions
following ECJ Denkavit ruling

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