State of the nationThe future of the US real estate market
Ask anyone who works in today’s U.S. real estate market about the most important issues in their industry, and they’ll probably tell you: Changing technology, live-work-play environments, and the repurposing of distressed or stranded real estate. In this article, I’m going to consider each issue in turn, and discuss what it means for the future of the US real estate market.
Advancements to technology contribute to every industry, and real estate is no exception. It affects how we find our information, how we search for homes and neighbourhoods, how we promote our businesses, how we interact with consumers, and how quickly we can connect with them.
In November 2016, the State Secretary for Finance came up with the following three suggestions to tighten the substance requirements for letter box companies:
1. A company can only get an advance tax ruling if it they can prove a presence in the Netherlands by meeting a minimum expense account and a minimum number of employees. Additionally, international holding companies will need to have more equity than the 15% that is currently required.
2. The Dutch Tax Administration will exchange information on holding companies that do not meet the substance criteria. Currently this is only done for financial service companies.
3. To increase the minimum risk threshold of 1% of its outstanding loans or €2 million in order to be able to apply the treaty withholding tax rates on interest and royalties.
On January 25 2017, the Dutch Parliament requested the government draft a proposal that is in line with these suggestions. The government was asked to focus on the creation of employment and the amount of salary paid.
The substance requirements in the Netherlands will be tightened with more focus on local employment and salaries. If you have an international holding company in the Netherlands you may want to check whether the current status of the substance of the company is in line with these new measures.