The crux of the dispute in the case boiled down to answering the question: at what point and in respect of what amount of interest does the tax liability for withholding tax arise?

The Supreme Administrative Court (NSA) concurred with the view of the Provincial Administrative Court (WSA) that there are no legal grounds for assuming that the tax base for withholding tax on interest receivables, in connection with participation in a cash pooling system, consists solely of the result of offsetting interest. The tax liability in this respect arises at the time of set-off, resulting in the mutual cancellation of claims up to the amount of the lower claim, and subsequently at the time of payment to the agent of interest receivables in the amount constituting the difference from the balancing of balances. It is irrelevant that the interest only becomes due as the difference in balances. It follows from the case law of the Supreme Court that claims subject to contractual set-off need not be enforceable or due.