Business succession scheme (BOR)
Will you get a business through an inheritance or as a gift? You may be able to take advantage of the business succession scheme (bedrijfsopvolgingsregeling, BOR). This scheme allows you to pay less or no inheritance or gift tax.
What is the business succession scheme (BOR)?
If you inherit or are gifted a business, you have pay tax. How much tax you have to pay depends on the value of the business. If you continue the business, you pay less or no inheritance tax or gift tax up to a certain amount. For example, if you take over the family business from your parents. This is called the business succession scheme (BOR, in Dutch).
When are you eligible for the BOR?
To make use of the business succession scheme (BOR), you must meet several requirements, such as:
- The business must be an active, ongoing business. If it concerns only investments, this scheme is not applicable.
- The previous owner must have owned the business for at least 5 years. If you inherit the business this period is 1 year.
- You cannot quit the business shortly after the acquisition. You must continue to operate the business for at least 5 years (continuation requirement). If you fail to do so, you still have to pay gift or inheritance tax. If you no longer meet the continuation requirement (in Dutch) you must file a tax return within 8 months by completing the form Aangifte niet voldoen aan het voortzettingsvereiste (pdf, in Dutch).
- Do you have shares in a nv or bv (public limited or private limited company)? Then you must remain the owner of these shares for at least 5 years. The business must also continue to operate for at least 5 years.
How to make use of the BOR
Do you want to make use of the BOR? Then you indicate that you want the exemption when you file your gift tax or inheritance tax return. You need to enter the details and value of the company on your tax return.
You can find more information and all conditions in the Dutch-language brochure Inheritance and gift tax and the business succession scheme (pdf).