The tax office has been asked to explain why people who own homes valued at more than €1.31 million have to pay a higher asset tax rate than those with cheaper homes, the Parool reported on Monday.

Accountancy BDO is taking legal action against the so-called villa tax, which means people whose homes have risen sharply in value but have few other assets are being forced to pay proportionally more tax than those with cheaper homes.

In the complex Dutch tax system, there is a ‘notional rent’ that is considered an extra income source – the eigenwoningforfait. This is set at 0.35% of a house valued at between€75,000 to the ‘villa tax’ limit and is something all homeowners pay.

But houses considered by the local council to be worth more than €1,310,000 have to pay this notional income of €4,585 plus an additional tax of 2.35%on every euro the home is worth more than €1,310,000.

So the owner of a property worth €1.5 million would pay €5,250 if the basic tax was applied to the full value of the property, but has to fork out €9,070 under the current system.

Some 50,000 homes in the Netherlands are currently valued at more than €1.310,000, a figure which rises in line with inflation every year.

BDO hopes for a similar outcome to the recent ruling covering savings and investments. The Council of State has now twice ruled that the tax paid should reflect the actual return on investment, rather than a fictitious amount.

“We have a lot of clients that this applies to and so we have agreed with the tax office that it will rule on one case concerning a client with an expensive house but no other assets, so we can go to court next year,” BDO partner Niek de Haan told the Parool.

Homeowners association VEH has long criticised the tax. “We’re not just talking about big detached homes, but terraced houses in Amsterdam which were built for civil servants and teachers,” a spokesman told the paper.

People who have paid off their mortgage did not have to pay the eigenwoningforfait because they no longer benefited from mortgage tax relief, but this exemption is gradually being reduced.