ADSs and/or common and/or cumulative preferred financing
shares, including but not limited to activities which are
beyond the scope of active portfolio investment activities,
and (iii) who does not have a substantial interest or a
deemed substantial interest in us, generally is subject to
income tax at a rate of 30% on a deemed yield of 4% of the
average market value of the ADSs and/or common and/ or
cumulative preferred financing shares at the beginning and
the end of the year, insofar as that average exceeds the
general exemption (heffingvrij vermogen).
Dutch individuals engaged in an enterprise and corporate
entities
Any benefits derived or deemed to be derived from ADSs,
common and/or cumulative preferred financing shares,
including any capital gains realized on the disposal thereof,
that are attributable to an enterprise of which the resident
derives a share of the profit, whether as an entrepreneur
(ondernemer) or as a person who has a co-entitlement to the
net worth of such enterprise other than by way of shares
and/or ADSs, common and/or cumulative preferred financing
shares, generally are subject to income tax at progressive
rates. Any benefits derived or deemed derived from ADSs,
common and/or cumulative preferred financing shares
including any capital gains realized on the disposal thereof
that are held by a Dutch resident corporate entity, generally
are subject to corporate income tax unless the Dutch
participation exemption applies.
Withholding tax
Dividends distributed by us are generally subject to a
withholding tax imposed by the Netherlands at a rate of
25%. See "Dutch Taxation for Non-Resident ADSs, Common
and/or Preferred Shareholders - Withholding Tax" above for
a definition of "dividends distributed by us" as used herein.
Dutch individuals and Dutch corporate entities generally can
credit the withholding tax against their Dutch income tax or
corporate income tax liability and generally are entitled to a
refund of dividend withholding tax insofar as the withholding
tax exceeds their aggregate income tax or corporate income
tax liability. In the case of certain holders of ADSs, common
and/or cumulative preferred financing shares subject to
Dutch corporate income tax and enjoying the participation
exemption, no withholding tax may need to be withheld at all.
According to an anti-dividend stripping provision, no
exemption from, credit, reduction or refund of, Dutch
dividend withholding tax will be granted if the ultimate
recipient of a dividend paid by us is not considered to be
the beneficial owner of such dividend. See "Dutch Taxation
for Non-Resident ADSs, Common and/or Preferred
Shareholders - Withholding Tax" above for a description of
who is considered a "beneficial owner."
Gift, estate and inheritance taxes
Dutch gift, estate or inheritance taxes may apply to an
acquisition of ADSs, common and/or cumulative preferred
financing shares by way of a gift by, or on the death of, a
holder of ADSs and/or common and/or cumulative preferred
financing shares a person who is resident or deemed to be
resident in the Netherlands.
Other Dutch taxes and duties
No registration tax, transfer tax, stamp duty or any other
similar documentary tax or duty will be payable in the
Netherlands in respect of holding ADSs, common and/or
cumulative preferred financing shares.
U.S. federal income taxation
The following is a summary of the principal U.S. federal
income tax consequences that may be relevant with respect
to the acquisition, ownership and disposition of our common
shares or ADSs. This summary addresses only the U.S.
federal income tax considerations of holders that were initial
purchasers of common shares or ADSs at the initial issue
price and hold common shares or ADSs as capital assets.
This summary does not address tax considerations
applicable to holders that may be subject to special tax
rules, such as financial institutions, insurance companies,
real estate investment trusts, regulated investment
companies, grantor trusts, dealers or traders in securities or
currencies, tax-exempt entities, persons that received
common shares or ADSs as compensation for the
performance of services, persons that will hold common
shares or ADSs as part of a "hedging" or "conversion"
transaction or as a position in a "straddle" for U.S. federal
income tax purposes, certain former citizens or long-term
residents of the United States, persons that have a
"functional currency" other than the U.S. dollar or holders
that own (or are deemed to own) 10% or more (by voting
power or value) of our common shares or ADSs. Moreover,
this summary does not address the U.S. federal estate and
gift or alternative minimum tax consequences of the
acquisition, ownership and disposition of our common
shares or ADSs.
This summary is based on (1) the federal tax laws of the
U.S. as in effect and available on the date of this annual
report, including the Internal Revenue Code, as amended,
judicial decisions, administrative pronouncements, and
currently effective and proposed U.S. Treasury Regulations,
AHOLD ANNUAL REPORT 2005 231
