General partnership (VOF)

A vennootschap onder firma (VOF), or general partnership, is a business that is run by two or more business partners. A defining aspect of the VOF is that every partner contributes something to the business, whether it’s labour, capital, assets, goodwill or knowledge. This model is often used by spouses or life partners who are also partners in business.

The VOF in a nutshell

• Establishment: Free, apart from small KvK fee and notary fee for partnership contract (see below)
• Capital required: None
• Governance: Partners
• Liability: All partners privately 100%
• Social security: No sickness benefits or unemployment benefits
• Taxation: BTW, income tax and payroll tax (if you have employees)
• Tax breaks: Yes if requirements are met

VOF & liability

Under the VOF business structure, both partners are liable for the debts of the business with their private assets. It’s important to understand the joint liability of a VOF: if your business partner makes a mistake that results in debt, then you will also be held financially responsible.

In a VOF it’s also necessary to create "separate capital" where business capital contributed by partners is held separately from private capital, for instance in a separate bank account.

Setting up a VOF business

A VOF is simple to establish; you only need to register it in person with the Dutch Chamber of Commerce (KvK). 

The VOF contract

It’s not legally compulsory to sign a partnership contract when setting up a VOF, but it is strongly advised to avoid misunderstandings between partners. This can be done either independently or via a notary. The partnership contract usually sets out:

• The name of the VOF
• The business aim
• The contributions of each partner
• Profit distribution and offset of losses
• Allocation of powers
• Arrangements for illness or holidays