KEEPING, MAINTAINING AND RETAINING RECORDS FOR TAX PURPOSES IN THE DUTCH CARIBBEAN
Records must be kept for 10 years
Pursuant to article 43 of the Netherlands Antilles State Ordinance on National Taxes (Algemene Landsverordening Landsbelastingen, “GONT”) an entity is obliged to keep the records (‘administratie’) of its assets and liabilities that clearly show the rights and obligations at all times and that provide the data relevant to the levying of taxes. These records and the associated data carriers must be kept for a period of 10 years. The GONT does not define what “records” are. The word records is therefore a grey area.
It is important to know that these obligations are also similarly applicable to the levying of taxes on third parties or persons. An entity is therefore also obliged to keep data that could be of relevance for levying taxes on a person or company with whom they have dealings. For example not all data about a loan might be relevant for an entity’s own records but they might be for the tax position of the third party concerned.
If a company either owns, directly or indirectly, at least 50% of the shares of another company, or has a say therein, the former is also obliged to make data, information and all data carriers that may be significant for levying taxes from the latter available on request by the Tax Inspector. The aforementioned is also applicable in cases where two or more natural persons or companies enter into a collaborative arrangement and together hold at least 50% of the shares, or say, in a company.
A levy based on an additional tax assessment may be imposed during a maximum period of 10 years being therefore the period that a company is obliged to keep its records. The aforementioned maximum period of 10 years that an additional levy may be imposed may be extended to 15 years if insufficient tax has been levied on a taxable element that is kept or has occurred abroad. One should be well aware that although the legal obligation is to keep documents for 10 years an assessment could be send after 15 years. If the documents, on which arguments are based for the nullification of the additional levy, are no longer available then the issue could be difficult to win.
Karel Frielink
Attorney (Lawyer) / Partner
