Upcoming Box 3 Reforms: What's Changing?

Key Takeaways

• The Dutch government plans to replace the deemed return system with a tax on actual returns (werkelijk rendement).
• The new system has been repeatedly delayed — originally planned for 2026, now expected 2027 at the earliest.
• Under the new system, you would pay tax on your real capital gains, dividends, interest, and rental income.
• The implementation is complex — tracking actual returns requires vastly more data from taxpayers and financial institutions.
• Until the new system takes effect, the current bridging legislation (category-based deemed returns) remains in force.

Why Is Box 3 Being Reformed?

The Kerstarrest (December 2021 Supreme Court ruling) made it clear: the government cannot sustainably tax fictional returns that bear no resemblance to reality. The court essentially said the system must move toward taxing actual returns (werkelijk rendement).

The bridging legislation introduced in 2023 was always intended as a temporary fix. While it improved the deemed return calculation by using asset categories, it still taxes fictional income. A fundamental redesign is needed.

The Proposed New System

Core Concept: Tax on Actual Returns

The new Box 3 system will tax the actual income and gains from your savings and investments:

The Unrealized Gains Question

One of the most debated aspects is whether unrealized capital gains (paper gains on assets you have not sold) should be taxed. The current plan includes a form of mark-to-market taxation:

• At year end, the value of your investments is compared to the start of the year (or purchase date)
• The increase in value is taxable — even if you have not sold
• Decreases can offset gains

This is controversial because:

• You may owe tax on paper profits you have not actually received
• It could force people to sell assets to pay the tax bill
• It adds complexity for illiquid assets (real estate, private equity, art)

Proposed Tax Rate

The tax rate on Box 3 actual returns is expected to remain at 36%, consistent with the current rate. However, applying 36% to actual returns (including unrealized gains) could result in higher or lower tax than the current system, depending on individual circumstances.

Tax-Free Allowance

The heffingsvrij vermogen (tax-free allowance) is expected to be maintained in some form. Whether it will remain at €57,000 per person or be adjusted is not yet confirmed.

What Will Change for Different Asset Types?

Savings Accounts

For savers, the new system should be good news:

• Currently: deemed return of 1.03% regardless of actual interest
• New system: taxed only on actual interest earned
• If your savings earn 0.5%, you pay tax on 0.5% — not 1.03%

Stock Portfolios

For stock investors, the impact is mixed:

• Currently: 6.04% deemed return regardless of performance
• New system: actual dividends + actual capital gains (realized and possibly unrealized)
• In strong market years, you could pay more tax
• In weak or losing years, you could pay less (or nothing)
• Losses may be deductible against future gains

Real Estate

For rental property owners, the new system is complex:

• Currently: 6.04% deemed return on property value
• New system: actual rental income + value appreciation
• Rental income would be straightforward to calculate
• Property value changes are harder — annual appraisals needed?
• Maintenance costs and mortgage interest may become deductible

Cryptocurrency

Crypto would be taxed on actual returns:

• Realized gains from selling
• Potentially unrealized gains (mark-to-market)
• Tracking cost basis across multiple exchanges and wallets is a significant compliance challenge

Implementation Challenges

Data Collection

The biggest hurdle is data. The current system is simple: the Belastingdienst only needs your balance on January 1st. The new system requires:

• All transactions throughout the year (buys, sells, dividends, interest)
• Cost basis for every asset
• Year-end valuations for unrealized gains
• Rental income and expenses
• Foreign asset transactions

Financial institutions will need to report far more data than they do today. This requires IT system upgrades across the entire financial sector.

Taxpayer Burden

Under the new system, taxpayers (or their advisors) will need to track:

• Purchase dates and prices of all investments
• Dividend payments received
• Interest income from all accounts
• Rental income and expenses for property
• Crypto transaction history across all platforms

Transition Issues

Moving from the old system to the new one raises questions:

• What is the cost basis of assets bought years ago? Is it the original purchase price or the value on the transition date?
• How are accumulated unrealized gains treated? Taxing the entire gain at once would be harsh; phasing it in would be complex.
• What about losses from prior years? Can they be carried forward into the new system?

Timeline

What Should You Do Now?

Short Term (2026)

• File under the current rules — the bridging legislation is the law
• Object if your actual returns are significantly below the deemed percentages — this preserves your rights
• Keep records of your actual investment returns, transaction history, and cost basis — you will need them when the new system arrives

Medium Term (2027+)

• Start tracking cost basis now — especially for crypto and foreign investments
• Organize your financial records — the new system will require more documentation
• Consider the impact on your investment strategy — if unrealized gains are taxed, the decision of when to sell becomes less relevant (you are taxed either way)

For Tax Advisors

• Stay up to date on Parliamentary proceedings and draft legislation
• Prepare clients for increased reporting requirements
• Consider the impact on client portfolio structures (holding companies, green investments, etc.)

Winners and Losers Under the New System

Common Mistakes

1. Waiting for the new system before acting — It may be years away. Optimize under current rules now.
2. Not keeping transaction records — Start now. Reconstructing years of trading history later is painful.
3. Assuming the new system will be simpler — It will likely be more complex, not less.
4. Ignoring the possibility of further delays — Plan as if the current system will continue for at least another year.

What to Read Next

• The Legal Challenges to Box 3 — The court rulings driving the reform
• How Box 3 Taxation Actually Works — The current system you need to file under
• Box 3 Strategies — Optimizing under current rules
• Box 3 Overview — The complete picture