Court faults tax authority over unsustainable €35 million bill against software founders

The Hague District Court has delivered a sharp rebuke to the Dutch Tax Authority for pursuing a case against two founders of Rotterdam software firm Mendix, according to Het Financieele Dagblad (FD). The Tax Authority was acting against better judgment, the court said.

One founder received a 35 million euro tax assessment, which would have resulted in “more or less his entire wealth being taxed away.” The court said the Tax Authority already knew at the time that the demand “could not hold up.”

Judges found the Authority should have opened discussions far sooner with the founders’ tax adviser. The men faced an “excessive tax burden of nearly 100 percent.”

Siemens acquired Mendix in 2018 for 628 million euros. The three founders still held roughly 30 percent of the shares at the time of the sale.