As entrepreneurs, we often assume that "being heard" is part of any fair administrative process. Yet, in tax matters, especially around VAT (omzetbelasting), this isn’t always a given. Understanding when the Belastingdienst (Tax Authority) must hear your side before issuing an assessment is not just legal trivia, it’s your right, and it can make or break your case.
Today, I want to walk you through this topic in clear steps, based on recent Dutch and European case law.
Article 4:12 Awb—What Does It Say?
The General Administrative Law Act (Awb) allows the inspector (belastinginspecteur) to issue a tax assessment without first hearing the taxpayer. This rule exists because tax assessments are considered “financial decisions” that can be fully undone during the objection (bezwaar) phase.
Simple? Yes. But not always complete.
Exception: When EU Law Is Involved
When a tax decision implements EU law and has negative consequences for you (an “adverse decision”), then the standard Dutch rules no longer apply. You must be given a chance to present your point of view before the decision is made.
This legal safeguard comes from the principle of defence under EU law, a fundamental right.
And here’s where VAT comes in: a supplementary VAT assessment (naheffingsaanslag btw) is such an adverse decision under EU law. That means the inspector must inform you and invite your response before making the decision.
What Exactly Is the “Principle of Defence”?
In short, it’s your right to be heard.
Before the tax authority imposes an adverse EU-law-based decision (like an extra VAT bill), they must:
- Explicitly inform you of their intention.
- Detail the underlying reasons and numerical foundations.
- Invite you clearly to respond to the intended decision.
This is not a formality, it’s your opportunity to correct errors, present overlooked facts, or contest misunderstandings before the decision becomes real.
What If You Weren’t Heard?
If the Tax Authority fails to respect this principle, then one must assess whether:
- The failure was justified under special circumstances.
- Your participation might have changed the outcome.
If the answer to the second point is yes, the assessment is not legally valid and must be annulled.
Case Study: The Supreme Court Judgment of 13 June 2025
Let’s make it concrete.
A taxpayer was under audit. During conversations with the inspector, two theories were discussed:
a) There was a Dutch permanent establishment, or
b) Someone else was the real customer, making VAT due.
Eventually, one theory was dropped, and the taxpayer, during a call, agreed with the second theory and even submitted the necessary data. Based on that, the VAT supplementary assessment was issued.
Sounds collaborative, right?
Yet, the taxpayer later claimed: "I was never formally told, in detail, of the final decision and never officially invited to respond."
The Court of Appeal said: “Yes, but you had the chance to speak up informally, so that’s fine.”
But the Supreme Court disagreed. They ruled that:
“Even if informal conversations happened and figures were shared, the inspector must formally and explicitly inform the taxpayer of the final assessment basis and give them the chance to respond, before imposing the assessment.”
And since that didn’t happen, the VAT assessment was annulled.
Your Practical Checklist
When facing a VAT supplementary assessment, ask yourself:
- Have I received written notification of the Tax Authority’s intention?
- Does it include specific reasons and calculations?
- Has the inspector explicitly asked me to respond before taking the final decision?
If the answer is “no,” you may have a strong case under EU law.
What to Do If You’re in This Situation
- Don’t panic.
- Lodge a timely objection (bezwaar), mention the violation of the EU principle of defence.
- If needed, seek help from a trusted compliance expert or tax advisor who understands both Dutch and EU procedural law.
Final Word From Me
As entrepreneurs, our time is precious and often stretched thin. But we should never be casual about our rights, especially when it comes to EU tax enforcement.
Understanding the principle of defence empowers you to ask the right questions, avoid silent assumptions, and protect your business with confidence and fairness.
And remember: even if you're small, you still have the right to be heard.
Co-Founder of Xtroverso | Head of Ledger and Tax Compliance
Linda Pavan brengt gedisciplineerde precisie naar Xtroverso en verankert de financiële, fiscale en operationele integriteit ervan. Als ZENTRIQ™ Gecertificeerd Auditor vertaalt zij complexiteit naar helderheid—waarbij elke beslissing traceerbaar, compliant en strategisch doordacht is. Haar stille nauwkeurigheid geeft bedrijven het vertrouwen en de verantwoordelijkheid om met zekerheid te handelen.
