Transfer tax in the Netherlands

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When buying a property, there are additional costs involved beyond the purchase price. This includes transfer tax. In the Netherlands, transfer tax is part of the buyer's costs (‘kosten koper’ in Dutch) when purchasing real estate. Different rates apply, and there's also a provision known as the starter's exemption (‘startersvrijstelling’ in Dutch). In this article, we will discuss everything related to transfer tax for real estate in the Netherlands.

When do you pay transfer tax in the Netherlands?

You are required to pay transfer tax when buying real estate. Property transfer tax in the Netherlands always goes through a notary. The transfer tax falls under the buyer’s costs, which means that as a buyer, you are responsible for the payment of transfer tax. However, there is a starter's exemption, which might allow you to be exempt from paying transfer tax when purchasing a home. The notary ensures the correct filing and transfers the transfer tax to the Dutch Tax and Customs Administration.

Transfer tax rates

The transfer tax rates can be categorized into three groups. The rate you pay depends on what you intend to do with the property. If you plan to live in it, you'll pay 0% or 2% transfer tax. However, if you don't intend to live in the property, you'll be subject to the highest rate. This rate applies to vacation homes, investment properties, commercial properties, retail properties, and garages not purchased with a residential property.

Transfer Tax Rates 2023

0% transfer tax Starter’s exemption
2% transfer tax Residential properties and for self-occupation
10,4% transfer tax Other real estate properties (investments for example)

Starter's Exemption

You might qualify for the starter's exemption. This exemption is for first-time buyers on the housing market who meet certain criteria. It was introduced to keep the additional costs for starters low, giving them a better chance in the housing market. You are eligible for the starter's exemption if you meet the following four conditions:

- You are between 18 and 35 years old at the time of transfer at the notary;
- The purchase price may not exceed €440,000;
- You have not previously used the starter’s exemption.

If you buy a property together with someone and one of you doesn't meet the conditions, the starter's exemption applies only to the one who does meet the criteria. In this case, the transfer tax to be paid will be half of what would originally have been paid. The notary can provide advice on this and assist with the transfer tax declaration.

When do you get exempted from transfer tax?

Apart from the starter's exemption, there are other exemptions. Even if you are eligible for an exemption, you must still file a transfer tax declaration. The notary can help you with this. You can be exempt from transfer tax in the following cases:

- When you pay both: VAT and transfer tax;
- When you buy out your partner;
- When purchasing agricultural or nature land;
- In cases of land consolidation;
- In urban redevelopment;
- When purchasing an estate.

Therefore, transfer tax is paid when acquiring real estate. The tax rate you pay depends on your intentions with the property. If you're buying for self-occupation, you'll pay the lowest rate, or you might even be exempt. To claim any exemptions, you should meet specific criteria, like the starter's exemption or other unique cases as mentioned above. In all cases, it's essential to file a transfer tax declaration with the Dutch Tax and Customs Administration. It's advisable to do this in cooperation with the notary to ensure accurate filing.

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