Advantages of a Dutch holding company over a German holding structure

What are the key tax advantages of a Dutch holding company (B.V.) over German models when purchasing, managing, and selling shareholdings? 1.1 Participation exemption

The core feature of the Dutch holding structure is that profits from qualifying shareholdings (usually 5% or more) in the B.V. are generally tax-exempt: no corporation tax is payable on dividends from subsidiaries in the holding company.

Even capital gains on the sale of subsidiary shares are not subject to corporate income tax in the Dutch holding company as the intermediate company. Practical example: Sale of a subsidiary An operating GmbH in Germany is incorporated into a Dutch holding B.V. (the B.V. holds, for example, 100% of the GmbH).

Sale of this GmbH share with a profit of EUR5 million. Under normal circumstances in a Dutch holding company: The profit is tax-exempt under the participation exemption if the requirements are met.

In the case of a German holding GmbH, capital gains would also be largely favored, but a 5% non-deductibility rule remains (i.e., a tax burden of approximately 1.5% in practice), and international structuring is often less flexible. Advantage of the Dutch holding company:
Particularly in large exit scenarios (e.g., the sale of subsidiaries, shareholdings), the B.V. can enable almost complete tax exemption at the holding level and is also well established internationally. 1.2 International dividend flows and withholding taxes The Netherlands has been established as a "holding location" for decades, with:

many double taxation agreements, the EU Parent-Subsidiary Directive, and very good recognition among international tax authorities. Practical example: Dividends from a subsidiary in a third country A Dutch holding B.V. holds 100% of a subsidiary in a European or Asian country.

Thanks to corresponding double taxation agreements and/or European directives, the withholding tax abroad can often be reduced (e.g., from 15-20% to 0-5%), and the dividend received by the B.V. can be tax-free (participation exemption).

The B.V. can then reinvest the profits in other countries or distribute them to a shareholder in another EU country. Advantage of the Dutch holding company: The Netherlands is "welcomed" by many countries. This means that global dividend flows can often be bundled more tax-efficiently via a Dutch holding company than directly to Germany.

1.3 Tax treatment of IP (patents, trademarks, licenses) A B.V. can also function as an IP holding company: patents, trademarks, utility models, software rights, etc. are held in the Dutch B.V. Operating companies (e.g., in Germany, France, the USA, etc.) then pay license fees to the B.V.

Depending on the specific structure and current Dutch law, license income can be taxed much more favorably in the B.V. than in many other countries. In addition, concentrating the IP in one place facilitates the subsequent sale of the IP package (share deal via the holding company or sale of the rights by the holding company).

Real-life example: Software start-up with international licensing The Dutch B.V. holds all software copyrights. A German and a US subsidiary pay annual licenses to the B.V. Profits from these licenses accrue centrally in the B.V., where: attractive taxation is possible,

and the subsequent sale of the IP or the B.V. shares can be structured in a tax-efficient manner. Advantage of the Dutch holding company: Collection and management of IP in a tax-attractive, internationally recognized country; flexible licensing models across multiple countries. 2. Legal and organizational advantages 2.1 Liability limitation and structuring

Like the German GmbH, the Dutch B.V. offers: Limited liability to the company's assets. Separation of: operational risk in subsidiaries (GmbH, S.L., S.A., Inc., etc.) and assets in the holding company (investments, IP, real estate, cash).

Practical example: Real estate and project structure The B.V. holds investments in several project companies (each project has its own GmbH or B.V.). If a project fails, losses are limited to this one subsidiary. The remaining investments and assets in the holding company are fundamentally protected.

Advantage of the Dutch holding company: Clear separation between "risky" (operational) and "valuable" (shareholdings, IP, real estate) as well as easy handling of the purchase/sale of individual projects (share deals). 2.2 Flexibility for global shareholdings Dutch B.V.s are very well accepted internationally:

Many banks, investors, and funds are familiar with NL holdings from practical experience. Standardized, legally secure structures. Easy integration into international joint ventures. Practical example: Joint venture with US and Asian partners, for example. All partners jointly establish a Dutch holding B.V. that holds the JV.

Advantages: "Neutral" EU location, no partner has "the upper hand" in terms of taxation. Less mistrust than with a purely German or US holding company. Clear, internationally recognized legal form.

Advantage of the Dutch holding company: As a neutral, internationally trusted holding location, the B.V. facilitates cooperation, capital raising, and structuring with partners from different countries. 3. Comparison with the German holding structure A German holding GmbH also has advantages (e.g., investment exemption, legal certainty, proximity to the entrepreneur, good acceptance by banks in Germany).
Typical differences in favor of the Dutch holding company, on the other hand, are: International acceptance and DTA network: The Netherlands has specialized in holding structures for decades; many countries have particularly favorable agreements with the Netherlands, which significantly reduces withholding taxes. Practice of tax-free dividends and capital gains (participation exemption):
In terms of breadth and flexibility, these are often more attractive than German regulations, especially for complex, international investment structures and exits. IP and licensing structures: Historically, the Netherlands has often been used for IP and licensing holding structures. Germany is more of a location for operational value creation than an international licensing hub.

International structure: A B.V. as the parent company of many subsidiaries in different countries is a global standard; German holding companies are accepted internationally, but are chosen somewhat less frequently as neutral "middle holding companies." 4. Cost overview (rough, without guarantee) 4.1 Formation costs for NL holding company (B.V.)

Notary + interpreter + commercial register + basic services: currently approx. EUR1,800-3,500 net for the pure establishment.

Share capital: Minimum capital for a B.V. is formally very low (theoretically EUR1.00), but in practice a "reasonable" initial capital is often chosen. 4.2 Running costs for a Dutch holding company Strongly dependent on scope, but typical guidelines:

Registered address with postal service: from approx. EUR500.00 net/month Accounting, annual financial statements, tax returns & communication with authorities: for a lean holding company (only a few entries, mainly dividends): from approx. EUR200/month possible (often offered as a package price), correspondingly higher for more complex structures.

Full-service packages (address, administration, accounting, annual financial statements, compliance) often start at around EUR550 net/month. 5. When can a Dutch holding company be particularly useful? Typical use cases: Planned later exit from larger holdings/subsidiaries -> tax-free sale of company shares at holding company level.

Global structure with many international dividend and license flows -> use of DTA, parent-subsidiary directive, participation exemption. Bundling of IP and license income -> central IP holding company, simplified subsequent sales and licensing.

Joint ventures with partners from different countries -> neutral, recognized location that does not give any partner a "home advantage." If you have any further questions about the establishment and subsequent administration/support, please contact me directly: m.ilgner@dutch-intraco.eu We provide exclusively administrative and organizational services in connection with the establishment and ongoing management of holding companies.
We expressly do not provide legal or tax advice. Such advice and services are provided exclusively by authorized professionals, in particular lawyers and tax advisors. On request, we will be happy to put you in touch with qualified Dutch and German lawyers and tax advisors.

Dutch Intraco Holding B.V.
Burg.Schonfeldplein 11-13
9671 CA Winschoten
Niederlande

https://www.dutch-intraco.eu

Herr Michael Ilgner
++49 152 900 67 673

m.ilgner@dutch-intraco.eu

About Dutch Intraco Holding B.V.: Dutch INTRACO Holding B.V. (www.dutch-intraco.eu) is a parent company with majority and minority shareholdings in subsidiaries in Europe. In addition, Dutch INTRACO manages holding companies under Dutch law for natural and legal persons who are not resident in the Netherlands.

This release was published on openPR.