Functional currency
It is possible for a Dutch resident entity to calculate its taxable profits on the basis of another currency than the euro, provided that it also prepares its financial accounts in that other currency.
Under Dutch GAAP, the functional currency used for financial reporting is not necessarily the euro. The functional currency should be the currency that best reflects the economic reality of transactions, events and situations that are relevant for the entity. For funds with investments, equity and/or debt instruments in another currency, that currency might qualify as functional currency.
The filing of a corporate income tax return in a foreign currency is only allowed after a specific request which has been granted by the Dutch tax authorities. The amount of corporate income tax due is denominated in euro. For purposes of determining this amount, the functional currency taxable amount is translated into euro using the average currency exchange rate of the financial year.
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Doing business in the Netherlands
A practical guide designed to give a general overview of the country and of the major applicable regulations for doing business in the Netherlands.
- Auteursrecht 2012 - Mazars - Netherlands
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- Auteursrecht 2012 - Mazars - Netherlands
