Netherlands: Amount B will not be introduced for Dutch taxpayers

08 December, 2024

The Netherlands government has announced, on 4 December 2024, in a decree that it will not be adopting the OECD’s new transfer pricing rules (Amount B). However, it will acknowledge other countries’ adoption of the OECD’s new transfer pricing regulations.

“Amount B will not be introduced for Dutch taxpayers who carry out routine marketing and distribution activities in the Netherlands,” the government stated.

The decree goes into effect starting 1 January 2025.

In February 2024, the Organization for Economic Cooperation and Development (OECD) introduced new guidelines to streamline how companies assess the value of specific transactions between related entities, referred to as Amount B As part of the Two-Pillar Solution to Address the Tax Challenges Arising from the Digitalisation of the Economy agreed by the OECD/G20 Inclusive Framework on BEPS in October 2021.

Amount B provides for a simplified and streamlined approach to the application of the arm’s length principle to in-country baseline marketing and distribution activities, with a particular focus on the needs of low-capacity countries. Content from the report has now been incorporated into the OECD Transfer Pricing Guidelines.

The decree on Amount B under Pillar One also outlined its implications for taxpayers in the Netherlands.

The decree also states that:

The Dutch Tax and Customs Administration will not impose Amount B rules to marketing and distribution activities in a covered jurisdiction where Amount B has been correctly applied;
The Dutch Tax Administration will adjust transfer prices to prevent double taxation if the jurisdiction has implemented and correctly applied Amount B and has a bilateral tax treaty with the Netherlands;
Amount B will not be introduced for Dutch taxpayers conducting routine marketing and distribution activities in the Netherlands. However, the decree highlights that Amount B may serve as a factor in determining corporate income tax for Dutch taxpayers in certain situations;
The Netherlands will extend the application of Amount B to both related legal entities and the profit allocation for permanent establishments (PEs) despite the OECD’s Amount B guidance not addressing its applicability to PEs.