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Tax Liability of Directors for VAT: Court Decision and Reduction of Liability

  • The court ruled on a case regarding the liability of directors for VAT and payroll tax assessments.
  • The directors were correctly held liable due to long-standing problems in the administrative organization that they should have been aware of.
  • The VAT assessments were based on an estimate, and the taxpayer was given the opportunity to provide evidence of the correct amounts owed, but failed to do so due to a lack of verifiable records.
  • The taxpayer did provide evidence that the estimate was based on incorrect facts and assumptions in some areas, which the tax authority did not refute.
  • The amount of the liability was reduced to the amount that the taxpayer claimed should have been estimated.
  • The liability was also reduced by the amount of the payroll tax assessments.
  • The tax authority was aware of the taxpayer’s inability to pay, and the deficiencies in the VAT administration cannot be used to support a claim of grossly improper management regarding the payroll taxes.
  • The appeal was successful.


Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.


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