Germany and the Netherlands signed a new double taxation treaty
on 12 April 2012. This new double taxation treaty
⦣8364;" which still has to be ratified by both
countries ⦣8364;" is expected to enter into effect
as from 1 January 2014. The new treaty replaces the current treaty
entered into in 1959 and is to a large extent modelled on the basis
of the 2010 OECD Model Convention. Distinctive features of the new
Dutch tax exempt entities have access to treaty benefits,
subject to application of anti-abuse rules which rules will in any
case be applied by Germany to Dutch exempt investment institutions
A provision regarding the application of the treaty to hybrid
entities is included which is modelled on the basis of the OECD
Gains derived from the disposal of shares in a non-public real
estate company by a more than 50% shareholder may be taxed by the
contracting state where the real estate is located. A company
qualifies as real estate company if 75% or more of its value is
derived from real estate located in that contracting state. The
other contracting state must give a tax credit for taxes levied by
the state where the real estate is located.
The treaty explicitly allows application of domestic anti-abuse
provisions, which include German anti-treaty shopping and CFC
No withholding tax on interest and royalties is allowed by the
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