Under the Dutch personal income tax system, income and assets are divided into three categories, known as "boxes". Box 2 covers income from substantial shareholdings, while Box 3 covers savings and investments. Both Box 2 and Box 3 form part of an individual's Dutch personal income tax return.
Under this regime, taxpayers were treated as non-residents for Box 2 (substantial interests) and Box 3 (savings and investments) purposes. As a result, many foreign assets, such as foreign bank accounts, investment portfolios and shareholdings, did not have to be reported in the Dutch income tax return.
