Dutch BV as a Holding: Taxes, Treaty and Brazil (2026)

A Dutch BV can serve as a holding because Dutch corporate income tax law generally exempts profits from holdings of at least 5% (deelnemingsvrijstelling). For Brazilians, this does not zero out the tax: Law No. 14,754/2023 (Lei 14.754/2023) taxes on December 31 the profit of a controlled entity abroad that falls under art. 5.

Does a Dutch BV work as a holding?

It does, as long as the BV's holding and income fit both the Dutch and the Brazilian rules. The BV (besloten vennootschap) is the Dutch limited liability company. As a holding, it owns stakes in other companies and receives their dividends.

The point that attracts holdings is the participation exemption. Art. 13 of the Wet op de vennootschapsbelasting 1969 (Wet Vpb 1969) says that the benefits from a participation, as well as the costs of buying or selling that participation, fall outside the profit base. What matters to the Brazilian is the other side: the same holding can be a passive controlled entity under Brazilian law, as the sections below show.

What is the corporate income tax rate in the Netherlands?

The table in art. 22 of the Wet Vpb 1969, in the version consulted on the official website, in force since January 1, 2026, has two brackets:

This applies to profit that is not exempt. Dividends from a qualifying participation generally fall outside this base because of art. 13. Since Dutch law changes often, confirm the current rule on Wettenbank before deciding.

How does the participation exemption (deelnemingsvrijstelling) work?

The exemption applies to the profit of a "participation" (deelneming). Under art. 13, § 2, "a", there is a participation when the taxpayer holds at least 5% of the paid-up nominal capital of a company whose capital is divided into shares.

There are exceptions. Art. 13, § 9, says the exemption does not apply to a participation held as an investment (beleggingsdeelneming), unless it is a qualifying investment participation. The criteria for classifying such a participation are in §§ 10 to 12 of the same article and involve, for example, what makes up the investee's assets. These criteria have technical details: confirm the current rule with a Dutch adviser before structuring.

Does the Netherlands withhold tax on dividends?

Under the Wet op de dividendbelasting 1965, art. 5 sets the withholding at 15% of the amount distributed. Art. 4 waives withholding in specific situations, such as a recipient that is an entity (lichaam) resident in the EU, the EEA or a treaty country, holding a participation that would qualify for the participation exemption.

For a Brazilian individual, the starting point is the percentage in art. 5. The treaty between Brazil and the Netherlands limits the withholding tax (see below). Waivers and reductions depend on the conditions of the case, so confirm the current rule on Wettenbank.

What does the Brazil-Netherlands treaty say?

The convention to avoid double taxation on income tax was signed on March 8, 1990 and promulgated in Brazil by Decree 355/1991. Two points are useful for anyone considering a BV:

• •Dividends (art. 10). The recipient's state of residence may tax them. The payer's state of residence may also, but if the recipient is the beneficial owner, the tax cannot exceed 15% of the gross amount.
• •Elimination of double taxation (art. 23, § 5). When a Brazilian resident receives income that may be taxed in the Netherlands, Brazil allows a deduction equal to the income tax paid there, subject to the limit set in the article itself.

The treaty does not suspend Brazil's controlled-entity rules. It deals with the division of taxing power between the two countries.

How does Brazil tax a BV controlled by an individual?

Law 14,754/2023 taxes the profit of a controlled entity abroad in the annual adjustment, at a rate of 15% (art. 2, § 1), on December 31 of each year, regardless of any resolution on distribution (art. 5, § 10, III). The criteria of art. 5:

1. •Controlled entity. The individual holds, alone or with related persons, rights that give a preponderant vote in decisions or the power to elect the majority of the directors, or more than 50% of the capital or profits (art. 5, § 1).
2. •Classification. The rule applies to a controlled entity that is in a favored-taxation country or has a privileged tax regime, or that has own active income below 60% of total income (art. 5, § 5).
3. •Own active income. The text excludes from this income, among others, dividends and equity interests (art. 5, § 6, I, "c" and "d"). The exclusion does not apply to holdings in entities that earn own active income above 60% (art. 5, § 8).

The practical consequence: a BV whose revenue is only dividends from investees must be tested against the 60% criterion, and the analysis depends on the investees. If the profit has already been taxed on December 31, the later distribution is reported in the DAA and is not taxed again (art. 5, § 11).

As for tax paid abroad, check arts. 4 and 5 of the law and the guidance from Brazil's Federal Revenue Service (Receita Federal) on the credit that applies to your case.

What if the shareholder is a Brazilian legal entity?

For a legal entity, the rule is in Law 12,973/2014. Art. 77 requires including in taxable profit and in the CSLL base of the controlling company domiciled in Brazil the portion of the investment adjustment equivalent to the profits earned by the controlled entity abroad. Art. 87 allows deducting, in proportion to the holding, the income tax paid abroad by the controlled entity, up to the limit of the income taxes levied in Brazil on those portions.

Arts. 78 and 79 deal with how to consolidate or individualize these results, with deadlines that have changed over time. For that reason, check the current text with the responsible accountant.

What should you check before opening a BV holding?

1. •Who controls it and where they reside. Define whether the shareholder is an individual or a legal entity in Brazil, because Law 14,754 and Law 12,973 differ.
2. •Where the BV's revenue comes from. Dividends, interest, royalties and capital gains enter the own active income test differently.
3. •Withholding and treaty. Confirm the Dutch withholding on dividends and the treaty limit for your case.
4. •Obligations in Brazil. Annual return and, depending on the value of the assets, the Central Bank's CBE. See the CBE page.
5. •Alternatives. Compare with other jurisdictions, as in the guide to the Malta Company.

To read more about the effects of controlled-entity rules, see CFC rules and offshore, the difference between opaque and transparent offshore companies and legal strategies for asset privacy. To structure with the team, see the services for corporate structures, tax planning and compliance, or book a session.