If you would like to be your own boss, then the Netherlands is a great place to consider starting up your own business. However, there are several administrative issues expats need to take care of.
Residence & Work permit
To be able to start up a business here, you must first make sure that you can stay in the Netherlands. EU, EEA and Swiss nationals are permitted to live and work in the Netherlands under EU law. If you don't come from an EU or EEA country, or you're not Swiss, then you will need to apply for a provisional residence permit (MVV) and in some cases a work permit (TWV).
Residence permit for self-employed
In the Netherlands, it is possible to apply for a residence permit as a self-employed entrepreneur. This application works with a points-based system, for which a minimum number of points must be met for the application to be successful. Importantly, the enterprise must serve an essential Dutch interest.
Startup visa for entrepreneurs
Since 2015, the Netherlands offers a residence permit known as the startup visa. This one-year residence permit is specifically tailored to international entrepreneurs who want to launch a business in the Netherlands.
Selecting a legal form for your business
Once you have ensured you can reside and work in the Netherlands, you need to decide which legal form your business will take. It’s important to choose a structure with the right fit, as this determines the liability for your business debts and tax obligations.
These and other related matters can be complicated but there are professional services that can help you out with the formation of your company.
Dutch legal forms of businesses
Here is an overview of all the Dutch business forms (rechtsvormen).
Unincorporated business structures (Rechtvormen zonder rechtspersoonlijkheid)
In these unincorporated legal forms, you (and your private assets) are liable for the debts of your business.
- Eenmanszaak: sole trader / one person business
- Vennootschap onder firma (VOF): general partnership
- Maatschap: commercial / professional partnership
- Commanditaire vennootschap (CV): limited partnership
Incorporated business structures (Rechtvormen met rechtspersoonlijkheid)
In these incorporated legal forms you and your private assets are, in most cases, protected from the debts of your business.
- Besloten vennootschap (BV): private limited company (ltd. or Inc.)
- Naamloze vennootschap (NV): public limited company (plc or Corp.)
- Coöperatie en onderlinge waarborgmaatschappij: cooperatives and mutual insurance societies
- Stichting: foundation
- Vereniging: association
Certain legal forms are better suited to certain types of businesses. For example, freelancers (ZZP) and small business owners usually choose the eenmanzaak structure, while the most common form for larger businesses is a BV. If you are dentists running a clinic you might choose a maatschap, or if you are operating an NGO you might choose a stichting.
Business registration at the KvK
When you have decided the type of business you would like to start, then you need to register it with the KvK (Kamer van Koophandel), the Dutch Chamber of Commerce, which will enter it in the Dutch Trade Register. Registration should happen from one week before you start doing business to one week after. To register your business you will need to be registered with your local municipality, otherwise you must provide authenticated proof of your residential address abroad.
You will need to select a business name (it’s possible to register more than one) and prepare a description of your business activities. It’s possible to check existing business names on the KvK search page (in Dutch).
If your business is unincorporated (such as an eenmanszaak or VOF) then you, and your partners if you have them, must submit the registration forms at the KvK. Businesses with an incorporated structure (such as BV or stichting) need to incorporate their company via notarial deed, so the KvK registration forms are normally submitted by the notary.
The business registration process
Here is the process if you are registering your business yourself:
- First complete a form on the KVK’s registration form page. Forms for all legal structures are available in both English and Dutch. You can fill out the form on screen and then print it in both languages. Text in the free writing fields, such as the description of your business activities, must also be translated into Dutch. Alternatively, if your Dutch is good enough, you can fill in a KVK online registration form (inschijven bij de KvK). On this page, you will need to select "enterprise or corporation" (onderneming of rechspersoon) and then fill in a series of pages in Dutch on your business details.
- Once your form is complete schedule an appointment to visit your local KvK branch on the appointment page (afspraak maken).
- When you have your appointment at the KvK business you will need to bring:
- Your completed form
- A payment (usually 50 euros)
- Valid ID (passport, residence permit or Dutch driving licence)
- Your business address and contact details (including rental contract if your business is not located at your home address)
Once you register you will be given a unique business number, known as the KvK nummer, which you will need to use on all invoices and outgoing post for your new business.
Business taxes in the Netherlands
Your new business also needs to be registered with the Belastingdienst (Dutch tax office). It is wise to register as soon as possible, so that you can claim VAT deductions on the investments you make to start the business.
If you are starting an unincorporated business (eenmanszaak, VOF, maatschap or CV) then you can register with the Belastingdienst during your KvK appointment. If you are starting an incorporated business (BV, NV, cooperatie, stichting, vereniging) then you can request the notary to register with the Belastingdienst.
Tax types for businesses
If you have a business in the Netherlands then you will need to pay some or all of the following types of tax:
- BTW (VAT)
- Income tax
- Payroll tax (if you have employees)
- Corporation tax (only applicable to incorporated businesses)
It is compulsory for most businesses to charge value-added tax, known as BTW, on all products and services they sell in the Netherlands. Consequently, almost all businesses are required to add BTW tax (usually 21 percent) to their sales. The tax office then collects this tax four times a year via the VAT declaration (BTW aangifte).
What does the BTW mean for your business?
- When you invoice clients for your services, or set a price on products, you will need to add an additional 21 percent BTW tax on top of your regular fee. This additional money must be set aside as you will be required to pay it to the tax office within the next few months.
- Every quarter you (or your accountant) will calculate your VAT declaration and transfer the BTW you have gathered to the tax office.
- You can deduct BTW from business-related expenses such as materials, travel costs or equipment.
- Under the Small Business Scheme (kleineondernemersregeling) if you collect under 1.883 euros BTW per year (after deductions) then you will pay less or no BTW to the Belastingdienst.
- If you do not submit the VAT declaration on time, or if your payment is late, then you will receive a fine.
Income Tax (inkomstbelasting)
If you have a business then you will need to do your annual income tax return, which is similar to when you are working in the Netherlands. Completing your income tax when you have a business is a little complicated as you need to prove you are an entrepreneur to gain access to certain tax benefits (see tax break section below). A good accountant is essential for helping you to calculate your income tax.
Payroll Tax (loonheffing)
Corporation Tax (vennootschapsbelasting)
If you have an incorporated business, such as a BV or NV, then you need to calculate and pay corporation tax (vennootschapsbelasting). Foundations and associations also sometimes need to do a corporate tax declaration.
Tax breaks for new businesses
There are several tax benefits, collectively known as the ondernemersaftrek (entrepreneurs’ deduction), that are available for new businesses in their first years.
Investment tax credit 2021 (BIK)
The Baangerelateerde Investeringskorting (BIK) was introduced on January 1, 2021. This investment tax credit scheme applies to investments in 2021 or 2022. The investment decision must be taken after October 1, 2020, full payment must be made in 2021 or 2022 and the new business asset must be in use within 6 months of making the decision.
As a self-employed person, you can also deduct work-related costs from your annual income. This includes materials and equipment, transportation and study expenses, services related to your business, workspace leasing costs or part of your rent if you work from home.
In the Netherlands, businesses are obliged to keep administrative records for seven years. This includes both electronic and paper records such as:
- Invoices sent
- Invoices received
- Bank statements
- Contracts and agreements
- Business activity expenses
How to format your invoices
When you make invoices for your business you must number them consecutively and provide the following information:
- Date and invoice number
- Business name, address, BTW & KvK numbers
- Name and address of customer
- Description of the product or service
- Price excluding BTW (VAT)
- BTW rate and amount
Bank accounts for businesses
You will need to open a business bank account. It will make it easier for you to manage your business by making your business administration go a lot smoother, saving you time. A separate account will also make sure your personal assets are protected, in case of fraud or bankruptcy. There are various banks in the Netherlands who offer bank accounts for entrepreneurs, for example, bunq.
Insurances and pension
As an independent business owner, you run risks that you are not exposed to as an employee. These can include:
- Inability to work due to illness or an accident.
- Damage to your business from fire or burglary.
- Being held responsible for mistakes or causing damage.
Other factors that you are responsible for as an entrepreneur are:
Taking out insurance protects you against such risks and can guarantee you an income if you are unable to work or if your business is adversely affected. Here is an overview of the main types of insurance for business owners:
Types of personal insurance include:
Health insurance is compulsory for everyone in the Netherlands.
Either private (through an insurance provider) or voluntary (via the UWV) to cover disability or incapacity to work.
A lump sum payment in case of disability caused by an accident.
Under the Maternity Benefit Scheme for the Self-employed (ZEZ or zwangerschapsuitkering) female entrepreneurs can apply for a pregnancy and maternity benefit for a minimum of 16 weeks.
Pension or Annuity policy
Since the Dutch state pension is not sufficient to live on, it is essential for entrepreneurs to build up additional retirement funds via a pension or annuity scheme.
Types of (voluntary) insurance that cover your business include:
Business or Professional liability insurance
If you or your company are held responsible for causing damage.
Legal expenses insurance
To cover legal expenses if a business issue goes to court.
Loss of profits insurance
Covers lost income if you have to temporarily shut down your business, for example after a fire.
For goods, machinery, equipment or buildings.
Partner or Associate insurance
If you cannot work with your business partner due to illness.
Machinery breakdown insurance
To cover repairs.
For damage caused by viruses, power cuts, Includes loss of data.
Goods transport insurance
To protect goods until they arrive at their destination.
To cover unpaid invoices from debtors.
Additional types of business insurance can be found on the Answers for Business webpage.
If you have employees then employee insurance (social security) is automatically deducted within the payroll tax.
Terms and conditions
To help protect yourself against conflicts and claims of liability you can apply general terms and conditions to your products and services.
Business plan and other issues
A fundamental part of preparing to be your own boss is to create a business strategy for finding clients and promoting your services. This includes making a website and financial and marketing plans.
Since you will be running a Dutch business it also makes sense to learn Dutch. This will not only help you manage your administration - especially when dealing with the Belastingdienst - but it will also help you to connect with Dutch clients and offer them a better service.
Recognition of your profession
In the Netherlands, there are a number of professions that are regulated, such as in the medical, scientific and legal fields. This means that you must have a recognised qualification in order to set up a business within that sector. If you obtained your qualification or diploma outside the Netherlands then you will need to get permission to practice in the Netherlands.
See the EP nuffic list of regulated professions in the Netherlands. To have your qualification recognised you will need to contact the competent authority shown under your profession in the list. For more information visit the Dutch government’s page on professional qualifications.
FAQ on starting up a business in the Netherlands
Are you setting up your own business in the Netherlands? Here are some common questions and useful links:
I need to convert my building for my new business. How do I get planning permission?
Each municipality in the Netherlands has its own zoning plan which dictates which business activities can occur in certain areas, as well as regulating any building or renovation work done to buildings. You can view your own municipalities zoning plan regulations here (in Dutch). If your plans do not fit in with the municipalities vision, then you are able to apply for a special permit or have the zoning plan amended. Note that this process can last a long time, however. More information on options can be found here.
How do I make sure my business is obeying environmental regulations?
Each business in the Netherlands is given an environment classification as "A," "B" or "C." If your business if classified as Type "A" then you do not need to worry about a permit. However, if your business if type "B" or 'C' then you will need to apply for a permit.
Can I set up my business office in my own home?
Yes, but you must first check with your local municipality to see if it is permitted. If it is, you may also be entitled to some tax deductions on, for example, your interior design costs.
What about fire safety?
If you are concerned that your place of business may be a fire hazard and would like to make sure you comply with fire regulation, you can apply for an occupancy permit or submit a notice of occupancy.