Equity in the ZZP and conversion ZZP to BV

[Rani P]

We had sent the Tax offices our request to convert ZZP to BV (silent conversion). In the documents we sent, we told that there is some extra liquidity (money) in the ZZP which we intend to withdraw and which affects the price at which BV is started (verkrigingsprijs). That means a part of the cash that was present in the ZZP (01-01-2022) will be withdrawn for personal use and not included in the BV. 

 

Now we approached accountant for the setting up process and management of the BV and came to know that this is not possible as we have chosen geruisloos (silent) conversion. Can anyone guide if this is possible or not?

 

Note - in the documents sent to Belastingdienst this money is shown as "overtollige middelen" and it is also said that these will be withdrawn. 

[Joost Rietveld]

Like I said in your other topic: this is NOT how it works. You can't make up your own procedures and just send paperwork to the Belastingdienst, and then expect them to respond or even sign off on something you want.

 

The fact that you mentioned in your letter to the Belastingdienst that this money is excess cash means nothing. The Belastingdienst is not at liberty to freely interpret the law. And that law states that whatever is part of the ZZP company at (in this case) January 1st 2022 will be part of the BV. The whole idea behind the “silent conversion” is that de BV continues with the former ZZP on a going concern basis; so the final balance sheet of the ZZP will become the opening balance sheet of de BV.

 

You should have given this some thought before filing the paperwork....

[Rani P]

Joost RietveldThank you for the reply. We have not done the process ourselves and our bookkeeper has initiated the process alongwith the documents sent to the Belastingdienst. We even took advise from a tax consultant before starting with the conversion and we were advised to go with the silent conversion. Tax consultant advised us to do the paperwork with the bookkeeper as it can be a costly affair to do it with him. 

 

We were during the process looking for other (new) accountant/bookkeepers for management of BV and there we came to know that the excess cash cannot be withdrawn. We were confused as both the opinions came from 2 different accountants and we want to be sure about the laws and so I posted the question here for advise. 

 

Just to confirm your opinion - Withdrawing cash from zzp by showing excess cash in the company before starting the BV (with silent conversion) is NOT at all possible? If not, how do you propose to solve the problem now that the paperwork has already been sent to the Belastingdienst with the notes that excess money is present in the company and it will be withdrawn. 

[Joost Rietveld]

Right, that makes a lot more sense. However, I am puzzled why a tax advisor would suggest to file the paperwork through a bookkeeper, since it’s (apparently) not the bookkeeper’s expertise. Nonetheless, you have to deal with it now.  

The only way to leave the excess cash out of the BV is to change your 2021 income tax return. On the balance sheet of December 31st you can subtract the excess cash from the business bank account balance. This means that the excess cash is now part of your Box 3 assets as of 1 January 2022.

And, this option only exists if your request with the Belastingdienst for the application of article 3.65 IB (the law dealing with the silent conversion) hasn’t been okayed by them yet.

[Rani P]

Joost RietveldI would like to thank you for your helpful, honest and quick reply. 

 

Just a doubt here - what do you mean when you say that the option can only be exercised if the application hasn't been okayed?  Can nothing be done now?

[Joost Rietveld]

If the Belastingdienst has signed off on your request for the geruisloze inbreng, then it means that the balance sheets you've sent them are accepted by them. You can refile your request, but they don't have to accept your changed data