She was a lawyer, worked as in-house legal counsel, operated a sole proprietorship and was the director and sole shareholder of a Dutch BV. Through that BV, she also held interests in two other companies. One of those companies provided her with an Audi A5, which she used privately. When she filed her 2019 personal income tax return, she reported taxable Box 1 income of €68,033. However, the return did not include a salary for her work for the companies. It also did not include the taxable benefit for the private use of the Audi, even though she had received an annual income statement showing this benefit. The Dutch Tax Administration corrected the return. Among other adjustments, the inspector added a customary director’s salary of €45,000. The dispute eventually reached the Zeeland-West-Brabant District Court. The Court agreed that a salary adjustment was necessary—but it did not agree with the amount calculated by the inspector. Why was a Dutch DGA salary required? The Dutch customary salary rules generally apply when someone works for a company in which that person, or their partner, has a substantial interest. In broad terms, a director-major shareholder cannot freely decide to take no salary while performing work for the BV. The salary must reflect the nature and duration of the work and must be tested against the statutory customary salary rules. The taxpayer in this case held a substantial interest in the companies and performed activities for them. She nevertheless reported no salary from those activities. The Court also considered her professional background. As a lawyer and company legal counsel, she was expected to understand that leaving both the salary and the company-car benefit out of the return could result in a substantial amount of tax not being collected. When an incomplete return changes the burden of proof The Court concluded that the taxpayer had not filed the required return. This conclusion had an important procedural consequence: the burden of proof was reversed and increased. Normally, the tax inspector must adequately support a correction. After reversal of the burden of proof, the taxpayer must convincingly demonstrate that the assessment is incorrect. That is a much more difficult position. The inspector must still base the assessment on a reasonable estimate. Reversal of the burden of proof does not give the tax authorities unlimited freedom to select any amount. That distinction became decisive in this case. Why the Court reduced the salary The inspector had included a customary salary of €45,000, which was the relevant statutory benchmark in 2019. The taxpayer argued that the activities of the companies had declined. The employees of two companies had been transferred to her sole proprietorship, and both companies were liquidated during 2019. These factual circumstances were not disputed. During the hearing, the inspector also acknowledged that €45,000 was a broad estimate. The Court therefore concluded that the full €45,000 was not a reasonable estimate. It determined a Dutch DGA salary of €22,500, including the taxable benefit for the private use of the Audi. The taxpayer’s Box 1 income was consequently reduced to €95,587. She won part of the case, but this should not be confused with the Court approving a general 50% reduction of the customary salary. This decision does not create a €22,500 DGA salary option The judgment concerned the specific facts of 2019. The companies were being wound down, their employees had been transferred and the inspector admitted that the original estimate was broad. The Court selected €22,500 as a reasonable estimate within those particular proceedings. For 2026, the customary salary must generally be at least the highest of: the salary for the most comparable employment; the salary of the highest-paid employee of the BV or a connected company; or €58,000. A lower salary may be possible, but the taxpayer must be able to substantiate why a lower amount reflects the most comparable employment or the actual circumstances. Cash flow difficulties alone do not automatically remove the salary obligation. Nor is it sufficient simply to omit the salary from payroll and the personal income tax return. The company car was part of the salary issue The Audi also played an important role. A company car that is available for private use can create a taxable benefit. In this case, the taxpayer had received an annual income statement showing the benefit but did not report it. The Court included the company-car benefit within the €22,500 salary estimate. This illustrates why DGA remuneration must be considered as a whole. The relevant package may include: gross salary; taxable benefits for a company car; expense reimbursements; pension arrangements; current-account transactions; dividends; and other payments made by or through the BV. Looking only at the monthly bank transfer can produce an incomplete picture. Other deductions do not repair a missing salary The taxpayer had also deducted mortgage interest for a second property. Renovation had started, but the work was not completed because of a dispute with the contractor and financing problems. The inspector rejected this deduction. The Court considered that rejection a reasonable estimate, and the taxpayer failed to provide the stronger evidence required after the burden of proof had been reversed. A late-filing penalty of €385 was also upheld. The case therefore shows how several seemingly separate matters can combine: DGA salary; payroll reporting; a company car; personal income tax; mortgage interest; and filing deadlines. Once the required return has not been filed, defending all the disputed items can become considerably more difficult. The DGA salary connects the BV and its owner For a director-shareholder, the company’s tax affairs cannot be separated completely from the director’s personal tax affairs. The salary is: a payroll expense for the BV; employment income for the director; relevant to wage tax filings; part of the company’s bookkeeping and annual accounts; and an element in calculating the BV’s taxable profit for corporate income tax. Dividends and shareholder current-account movements add further connections. This is why decisions about salary, dividends and private expenses should be made before the annual accounts and tax returns are prepared—not reconstructed afterwards. Determine the salary and document the reasoning A BV owner should address the customary salary at the start of each year and reconsider it if the circumstances change substantially. Relevant questions include: What work does the director actually perform? How much time is spent working for the BV? What would someone without shares earn for comparable work? Does the BV or a connected company employ someone on a higher salary? Is the company starting, expanding, becoming inactive or being liquidated? Are there taxable benefits such as a company car? Has a lower salary position been properly documented? Are payroll, bookkeeping and the personal tax return consistent? A lower salary may sometimes be defensible. No salary may occasionally be appropriate if the customary value of the work is genuinely very limited. But these positions require facts and evidence. Silence in the tax return is not documentation. Coordinated support for your Dutch BV OrangeTax supports international directors and shareholders with Dutch payroll, bookkeeping, annual accounts, corporate income tax and personal income tax. By considering these obligations together, discrepancies can be identified before they become corrections, penalties or disputes. Do you work for your own Dutch BV and want to know whether your salary, payroll and corporate tax position are correctly aligned? Contact OrangeTax to discuss your situation. This article provides general information and does not constitute individual tax advice. The correct customary salary depends on the legislation for the relevant year and the specific facts and evidence. Sources Zeeland-West-Brabant District Court, 4 August 2026, ECLI:NL:RBZWB:2026:7179. Dutch Tax Administration, salary and substantial shareholdings. Dutch Tax Administration, Payroll Taxes Manual 2026. OrangeTax, DGA Salary Rules for Foreign Directors Explained. The post Dutch DGA Salary: Why Leaving It Out Can Backfire appeared first on OrangeTax.