Signal model OB Balance Sheet Payables (BAS)

Dutch Tax and Customs Administration

The 'OB Balance Payables' algorithm helps the Tax and Customs Administration employee detect remittance differences. A remittance difference occurs when it appears that, based on the most recent income tax or corporate tax return, more sales tax was due than was declared for that year.

Last change on 4th of April 2025, at 14:13 (CET) | Publication Standard 1.0

• Publication category: Impactful algorithms
• Impact assessment: Field not filled in.
• Status: In use

General information

Theme

Public finance

Begin date

Field not filled in.

Contact information

[e-mail]

Link to publication website

https://over-ons.belastingdienst.nl/onderwerpen/omgaan-met-gegevens/algoritmeregister/

Link to source registration

https://over-ons.belastingdienst.nl/onderwerpen/omgaan-met-gegevens/algoritmeregister/signaalmodel-ob-balansschulden-bas/

Responsible use

Goal and impact

Most businesses file sales tax (also known as VAT) returns. Sales tax returns are filed for a specific period of time, monthly, quarterly or annually. Income tax (IB) or corporate income tax (VPB) returns are usually filed later than sales tax returns for the same year. This is due to the different return deadlines and the return period. The tax authorities use the IB and VPB returns to check whether the VAT returns submitted earlier were correct.

The IB or VPB return of an entrepreneur or company contains a statement of assets, liabilities and equity. This is called the balance sheet. The balance sheet may include an amount of outstanding VAT. This amount should correspond to the OB return for the last period of that year. If there is a difference that cannot be explained, an employee contacts the entrepreneur to assess whether the earlier VAT return is correct.

Considerations

By deploying the algorithm, the OB tax return data are automatically compared with the relevant IB and VPB data. As a result, remittance differences can be noticed from the moment the tax authorities have this data. Thus, targeted action can be taken to prevent tax arrears from accumulating. This contributes to tax compliance.

Human intervention

Human intervention in the Tax Administration context implies that a competent and knowledgeable employee plays a substantial role in the decision-making process.

When there is a remittance difference, the algorithm creates a treatment signal. Based on this signal, the clerk contacts the entrepreneur and assesses whether the previously submitted VAT return is correct. It is the Inland Revenue employee who makes the decision to make a correction if necessary.

Risk management

Conditions, a quality framework, have been drawn up by the Tax Administration for the development of algorithms. This contains rules and agreements that are followed during algorithm development. The conditions of the National Audit Authority are leading in this respect. At regular intervals, the Tax and Customs Administration checks whether the algorithm still meets the quality requirements.The algorithm uses data collected under various tax laws. As required by the AVG, no more data is used than necessary.

The business rules are reviewed periodically and adjusted if necessary to remain compliant with laws and regulations.

Legal basis

• General Administrative Law Act
• General State Taxes Act
• Citizen Service Number (General Provisions) Act
• Turnover Tax Act 1968
• Collection Act 1990
• Income Tax Act 2001
• Corporation Tax Act 1969
• General Data Protection Regulation
• General Data Protection Regulation (Implementation) Act

Links to legal bases

• Algemene wet Bestuursrecht: https://wetten.overheid.nl/jci1.3:c:BWBR0005537&z=2023-01-01&g=2023-01-01
• Algemene wet inzake rijksbelastingen : https://wetten.overheid.nl/jci1.3:c:BWBR0002320&z=2023-01-01&g=2023-01-01
• Wet algemene bepalingen burgerservicenummer: https://wetten.overheid.nl/BWBR0022428/
• Wet op de omzetbelasting 1968: https://wetten.overheid.nl/BWBR0002629/
• Invorderingswet 1990: https://wetten.overheid.nl/jci1.3:c:BWBR0004770&z=2023-01-01&g=2023-01-01
• Wet Inkomstenbelasting 2001: https://wetten.overheid.nl/BWBR0011353/
• Wet op de Vennootschapsbelasting 1969: https://wetten.overheid.nl/BWBR0002672/
• Algemene verordening gegevensbescherming: https://eur-lex.europa.eu/legal-content/NL/TXT/HTML/?uri=CELEX:32016R0679
• Uitvoeringswet algemene verordening gegevensbescherming: https://wetten.overheid.nl/BWBR0040940/

Elaboration on impact assessments

The use of data should be assessed against the General Data Protection Regulation (AVG). Reviewing personal data reveals any privacy risks and allows appropriate measures to be taken.

The AVG prescribes that no more data should be used than necessary. This is called data minimisation. The Tax Administration regularly examines whether the data used are still necessary and can therefore be used.

• Equality and non-discrimination

The algorithm is assessed in line with applicable non-discrimination principles for direct and indirect discrimination. Processing as little personal data as possible reduces the risk of direct discrimination. Employees involved in developing and managing the algorithms receive training on data protection and bias.

Operations

Data

• Identifying data
• Company data
• Turnover tax return details
• Income tax return details
• Corporate income tax return details
• Payment details

Links to data sources

• Identificerende gegevens: Basisregistratie Personen (BRP)
• Bedrijfsgegevens: KvK (Kamer van Koophandel)
• Aangiftegegevens Omzetbelasting: Belastingdienst
• Aangiftegegeven Inkomstenbelasting: Belastingdienst
• Aangiftegegevens Vennootschapsbelasting: Belastingdienst
• Betalingsgegevens: Belastingdienst

Technical design

The algorithm consists of business rules created by content experts based on laws, regulations and expertise.

The algorithm is not self-learning. That means it does not evolve as it is used.

External provider

The algorithm was developed by Tax Administration staff and is maintained internally.