Change to the allocation of the Box 3 base following a collective decision on objection

Legal redress Box 3

On 24 December 2021, the Supreme Court ruled that the manner in which the Box 3 levy has been structured since 2017 is contrary to both the prohibition of discrimination (Article 14 ECHR) and the right to peaceful enjoyment of property (Article 1 FP ECHR). By way of legal redress, the Supreme Court reduced the income tax assessments for 2017 and 2018 (the years covered by the proceedings) by including only the actual return realised in the levy.

In response to the so-called Christmas Judgment, the Box 3 Legal Redress Act was introduced. This Act provides, with retroactive effect from 1 January 2017, for compensation to taxpayers who participated in the mass objection proceedings against Box 3, and to taxpayers whose income tax assessment for (one of) the years 2017 through 2020 had not been imposed or was not yet final on 24 December 2021, and to all taxpayers with Box 3 income for the years 2021 and 2022. The compensation is based on the so-called flat-rate savings variant. This still assumes a flat-rate return, but based on the actual composition of a taxpayer’s assets, broken down into bank balances, other assets, and liabilities.

On 6 June 2024, however, the Supreme Court ruled that neither the Box 3 Legal Redress Act nor the Box 3 Bridging Act, which has been in force since 1 January 2023, can withstand scrutiny. The tax assessment must be reduced such that in Box 3 income tax is levied only on the actual return realised. This test is carried out on an annual basis, but it is the taxpayer who is responsible for demonstrating that the actual return is lower than the fixed-rate return. On the back of this, a rebuttal scheme has been added to the Box 3 Legal Redress Act and the Box 3 Bridging Act, with retroactive effect.

Change to the allocation of the Box 3 base

One question had not yet been answered in previous judgments and that is whether, following the collective decision on objection, partners for tax purposes who participated in the mass objection proceedings against the Box 3 levy for the years 2017 through 2020 may still change the mutual allocation of their joint savings and investment base.

Under the literal wording of the legislation, this is not the case. A change to the allocation is permitted as long as the income tax assessment of either of the partners for tax purposes has not yet become final. But that is precisely the case following the collective decision on objection, as an appeal against a collective decision is no longer possible. Responding to preliminary questions from the Court in The Hague, the Supreme Court ruled that this cannot have been the intention of the legislature.

If a tax assessment has become final in response to a judgment of the Supreme Court, the legislator permits the allocation between the partners to be changed up to six weeks after that judgment. The rationale is that the partners for tax purposes only gain a full understanding of the financial details of the chosen allocation after that final judgment. The Supreme Court argues that, in all reasonableness, it is not possible to see why this should be any different following a ruling by the Supreme Court in mass objection proceedings. A reasonable application of the law implies that in that case, too, the allocation of the mutual income components and the joint tax base for savings and investments may be changed up to six weeks after that ruling.

If the Tax Inspector is found to be wholly or partly in the wrong, they must grant a reduction to eligible taxpayers within six months of the collective decision on objection. In that case, the partners for tax purposes concerned may even make changes to the chosen allocation up to six weeks after that decision granting a reduction.

• Supreme Court 27 March 2026, 25/02264, ECLI:NL:HR:2026:495