Executive Summary

Dutch tax classification rules for foreign legal forms change 1 January 2025. Funds—especially partnerships and joint-account structures—may shift from transparent to non-transparent or vice versa. You’ll gain clarity on the new similarity, fixed and symmetrical approaches, fund-for-joint-account (FGR) criteria, transitional planning and mitigation steps.

By reading this article, CFOs will be able to: evaluate whether your fund may unintentionally shift tax status; plan restructuring using the transitional redemption-fund window; apply the fixed, symmetrical or similarity approach correctly; and engage with additional guidance on FGR classification.


Understanding What Changes

From 1 January 2025, the Dutch Classification Decree replaces the old similarity-only test with three methods:

• Similarity approach: compare characteristics of the foreign entity to equivalent Dutch legal forms; where clear match, apply equivalent classification.
• Fixed approach: non-Dutch entities tax-resident in the Netherlands without a Dutch equivalent are always non-transparent (subject to Dutch CIT).
• Symmetrical approach: non-resident entities with no Dutch equivalent follow the tax classification as in their jurisdiction of residence. 

 

Fund-for-Joint-Account (FGR) Prevails

If an entity qualifies as a fonds voor gemene rekening (FGR), this classification takes precedence. Under the new rules, an FGR is non-transparent (i.e., opaque for Dutch CIT) only if:

• It’s an investment fund or UCITS under the Dutch Financial Supervision Act (Wft).
• Participations are tradeable certificates.
• It pursues normal portfolio management strategy.

Other FGRs may still be transparent (a “transparent fund”) or may default to non-transparent based on these criteria.

 

Transitional Options in 2024

A redemption fund restructuring window in 2025 allows investment funds previously transparent to restructure, if documented correctly in 2024 (e.g., board minutes). If not restructured, they may default to non-transparent FGR status as of 1 January 2025.

 

Practical Issues & Ongoing Guidance

The Dutch Tax Authorities published a detailed Q&A clarifying transitional law, methodology (including use of symmetrical approach in federal countries), and FGR criteria. A form annex helps assess unidentified entity types. New classifications will be published during 2025. 
Stakeholder consultation led to a June 2025 letter from the State Secretary confirming intention to revisit FGR definitions to reduce unintended re-classification risks. 

Conclusion

CFOs and tax managers should now:

1. Review fund structures under the similarity, fixed and symmetrical approaches.
2. Assess whether your fund meets FGR criteria and if reclassification is unintended.
3. Use the 2025 redemption-fund transition opportunity with proper documentation.
4. Monitor updates—new classifications and possible FGR rule refinements.
   

 

*Disclaimer: This article provides general information only and does not constitute professional advice. Seek tailored guidance before acting.