Applying for a tax payment extension

The government is easing restrictions on applications for tax payment extensions due to the coronavirus outbreak. The following will outline the requirements for such applications.

What does the extension mean?

If you are experiencing financial difficulties as a result of the coronavirus outbreak, you may be eligible to receive an extension for tax payments of at least three months. You will not have to pay any fines for late payment.

To which taxes do extensions apply?

You will be able to apply for a payment extension for the following taxes:

• Personal income tax
• Corporate income tax
• VAT
• payroll taxes

Upon receipt of the application, the Tax and Customs Administration will halt collection for the relevant tax assessments for a period of three months.

Extensions exceeding three months

In the event that the payment extension of three months should prove too short, you can also apply for a longer extension period. In such cases, the Tax Administration may ask you to submit an expert statement, which Accon International will be able to provide.

1. Tax return
   Although you may have applied for an extension, you will nevertheless have to submit a tax return (or have a return submitted) within the specified deadline. Ordinarily, you would pay wage taxes or VAT directly, however, you will not be doing so in this case. You will then receive a final assessment, after which you will be able to send a letter to the Tax and Customs Administration applying for a payment extension. Your application will require substantiation: you must be able to outline the impact that you are experiencing as a result of coronavirus. If you have multiple companies or multiple legal entities (BVs), please submit an individual application letter for each company or legal entity (taxable entity).
2. Notification of inability to pay
   On 7 April, the Tax Service Providers’ Forum (Forum Fiscaal Dienstverleners) announced that the Ministry of Finance had decided that any directors requesting an extension of VAT payments and/or payroll tax payments in connection with coronavirus will not require a notification of inability to pay. This applies both to previous periods and the near future. A notification of inability to pay is required to avoid liability for these tax debts on the part of the director of a legal entity. If bankruptcy cannot be avoided, notification of inability to pay will naturally still be required for each company.
3. Additional notification for pension contributions
   If you would also like to apply for a payment extension for pension contributions, you must submit a separate notification of inability to pay. This notification must be directed to your company pension fund.

Get assistance

If you would like guidance when applying for a tax payment extension, my colleagues at Accon International are happy to assist however they can. Please consult your contact or email international@acconavm.nl and we will get back to you as soon as possible.

Want to find out more?

At accon■avm, we have put together a special team, which closely monitors all developments on issues relating to coronavirus, allowing us to provide advisory services in every field.

If you are an existing customer, please get in touch with your contact. He/she will have the best knowledge of your circumstances and will be able to work with a fellow specialist if necessary. If you are not an existing customer but do have questions, we are happy to help you or be there for you to share your concerns! Our international colleagues are likewise available to assist. Please get in touch via international@acconavm.nl. Together, we can help you grow your business, even under challenging circumstances.