The DTA signed between The Netherlands and China back in May 2013, entered into forced on August 31, 2014. The DTA replaces the 1987’s DTA.
Once the ratification formalities ended, in The Netherlands as well as in China, the agreement will be applicable to income earned as of January 1, 2015. The DTA includes measures that allow dividend distribution to the holding of the other estate at a reduced tax rate of 5%.
The DTA includes information exchange and anti-abuse clauses aiming to avoid tax evasion. It regulates the mutual assistance for collecting taxes and changes the conditions to determine whether or not a permanent establishment exists.