Dutch Supreme Court: No compensation for non-objectors Box 3

The Supreme Court, as the highest national court in the Netherlands, has decided that taxpayers who did not file an objection in time are not entitled to compensation for Box 3 for the 2017 to 2020 calendar years. This means that only taxpayers who submitted a timely objection qualify for legal redress. Taxpayers whose assessments were not yet final when the Supreme Court issued its Christmas judgement also qualify for legal redress, as do those who submitted a timely request for an ex officio reduction. The Supreme Court’s ruling applies only to the 2017 to 2020 calendar years. For the 2021 to 2024 calendar years, you can still complete the Actual Return Statement form.

In principle, taxpayers who did not object may still be able to bring their case before the European Court of Human Rights (ECtHR). For now, it remains to be seen how relevant interest groups such as the umbrella organisations for tax advisers, the Dutch Consumers’ Association and the Association for Taxpayers view the prospects of success. This may be worth considering for a very small and specific group of taxpayers with substantial investment portfolios whose actual Box 3 income is significantly lower than their deemed Box 3 income.

Following the Supreme Court’s Christmas judgement of 24 December 2021, the State Secretary for Finance announced on Budget Day 2022 that taxpayers who did not object would not qualify for Box 3 legal redress for the 2017–2020 calendar years. The State Secretary based this decision on the Supreme Court’s ruling of 20 May 2022 that, under the applicable legislation and regulations, non-objecting taxpayers do not have to be granted compensation aimed at restoring their legal position for the 2017 and 2018 calendar years. As many taxpayers nevertheless wanted to continue litigating this issue despite that negative ruling, a mass objection plus procedure was initiated.

That procedure raised several grounds and sub-questions, on a non-exhaustive basis, that had not been expressly addressed in the Supreme Court’s ruling of 20 May 2022. In that ruling, the Supreme Court held that the incorrectness of the tax assessments imposed for the 2017 and 2018 calendar years followed from its Christmas judgement of 24 December 2021. By then, however, those assessments had already become final. Under Dutch law, an assessment is not reduced ex officio if the incorrectness arises from case law handed down only after the assessment has become final. This is referred to as the ‘new case law’ exception. In its 20 May 2022 ruling, the Supreme Court considered the Christmas judgement to be ‘new case law’. However, that ruling did not address whether the distinction between taxpayers who did object and those who did not was incompatible with the prohibition of discrimination or the principle of proportionality.

In a 2024 ruling on pension benefits, the Supreme Court further clarified the ‘new case law’ exception. In essence, that clarification turned on the following question: when the tax assessment became final, could the Inspector reasonably have believed that his legal interpretation was correct, in other words, that the Box 3 levy for the years from 2017 onwards did not amount to an unjustified interference with the fundamental rights protected by the ECHR?

In all four selected cases, the district courts ruled against the taxpayers. In two of those cases, appeals in cassation were filed immediately through leapfrog appeal.

On 8 May 2026, Advocate General Pauwels delivered his opinion in these cases. In his view, the Inspector could reasonably have assumed that his legal interpretation was correct and that the Box 3 levy for the years from 2017 onwards was not incompatible with the fundamental rights protected by the ECHR. Like the four district courts, he concluded that taxpayers who did not object are not entitled to legal redress for the 2017 to 2020 tax years. He therefore advised the Supreme Court to dismiss the appeals in cassation as unfounded.

The Supreme Court followed the reasoning of the four district courts in the mass objection plus proceedings and the opinion of the Advocate General.

The Supreme Court’s key considerations are as follows:

• The Christmas judgement qualifies as new case law. The Supreme Court sees no reason to move away from its ruling of 20 May 2022, where it held that the Christmas judgement makes up new case law in relation to the deemed Box 3 tax regime as it applies from 2017 onwards. That regime differs so fundamentally from the rules that applied before then that the case law on the earlier regime doesn’t provide a conclusive answer on whether the regime in force from 2017 is compatible with the fundamental rights protected by the ECHR.
• Taxpayers who did not object cannot therefore rely on the Christmas judgement.
• This conclusion withstands scrutiny under:
  • the prohibition of discrimination, because taxpayers who did not object are not in the same position as those who did object;
  • the principle of proportionality, because the adverse consequences of the ‘new case law’ exception for the taxpayers concerned are not disproportionate to the objectives it serves, namely legal certainty and practical considerations; and
  • the other principles of good governance.

On 17 July 2026, the Dutch Tax Administration published the collective decision on objection. The Dutch Tax Administration rejected all requests and declared all objections to which the mass objection plus designation applies unfounded. Although two of the four selected test cases have not yet been completed, the Dutch Tax Administration takes the view that the relevant legal questions were answered definitively and in the negative by the Dutch Supreme Court’s ruling of 25 June 2026. No appeal can be lodged against the collective decision.

For taxpayers who did not object, the next possible step is to take their case to the European Court of Human Rights (ECtHR). The State Secretary addressed this in a letter dated 15 December 2022 to the umbrella organisations for tax advisers (NBA, NOAB, NOB, RB and SRA), the Dutch Consumers’ Association and the Association for Taxpayers.

In that letter, he promised that, in any proceedings before the ECtHR, he would ask the Ministry of Foreign Affairs not to argue on behalf of the Netherlands that an application is inadmissible where the applicant did not submit a request for an ex officio reduction. Under the ECHR, the ECtHR can hear a case only after all domestic remedies have been exhausted. The ECtHR could otherwise conclude that a taxpayer who did not object and did not submit a request for an ex officio reduction has failed to exhaust those remedies. The State Secretary’s promise removes that obstacle. Even so, the ECtHR could still decide that an application is inadmissible on other grounds.

Taking a case to the ECtHR is, however, time-consuming and costly. In practice, it is likely to be worth considering only where the financial stakes are significant, for example, for a small group of taxpayers with substantial investments whose actual Box 3 income is considerably lower than their deemed income.