Start a Business in the Netherlands
Introduction to Starting a Business in the Netherlands
Are you dreaming about starting a business in the Netherlands? It's a decision that can be both exciting and intimidating. But fear not, this guide is designed to navigate you through the process smoothly, from the formation of your company to the time you decide to expand and grow. The Netherlands offers an inviting business environment and is particularly favorable for entrepreneurs looking to set up international operations.
Once you've gotten a grip on the legal requirements, the next step is to decide which type of business structure suits your company best. This decision will greatly influence your company's future. In the Netherlands, several legal entities are available depending on your needs and goals. Below is a helpful table outlining the main types:
How to Open a Company in the Netherlands
Starting a business in the Netherlands requires at the very least, an understanding of the type of legal entities that the Netherlands has to offer.
The first step in the process is to choose a suitable legal structure for the business, such as a sole proprietorship, partnership, branch registration, or private limited company. It is important to consider factors such as the level of liability, tax implications, and the ease of setting up and maintaining the chosen structure.
Once the legal structure is decided upon, the next step is to register the business with the Dutch Trade Register at the Chamber of Commerce. This involves submitting a registration form, along with a copy of the company's articles of association, proof of identification for all shareholders and directors, and a bank statement showing the initial capital deposit. It is important to ensure that all documentation is complete and accurate to avoid delays in the registration process.
After registering the business in the Netherlasnds , it is necessary to obtain a value-added tax (VAT) number from the Dutch Tax and Customs Administration if the company's annual turnover exceeds a certain threshold. Additionally, depending on the nature of the business, it may be necessary to obtain specific permits or licenses from relevant authorities. This could include a trade license, environmental permit, or specific industry certifications. It is important to thoroughly research and comply with all regulatory requirements to ensure the smooth and legal operation of the business.
In addition to the legal and regulatory requirements, it is important to consider the financial aspects of opening a company in the Netherlands. This includes creating a business plan, opening a business bank account, and arranging the necessary insurance coverage. It is also important to understand the tax implications of operating a business in the Netherlands, including corporate tax, income tax, and social security contributions. Seeking the advice of a qualified accountant or tax advisor can be beneficial in navigating the complexities of the Dutch tax system and ensuring compliance with all tax obligations.
Opening a company in the Netherlands is a significant commitment that requires careful consideration of legal, regulatory, and financial requirements. By thorough planning and adherence to legal and administrative procedures, aspiring entrepreneurs can successfully establish a business in the Netherlands and contribute to the dynamic Dutch economy.
Can I start a business in Holland even if I'm not a resident?
Forming a company in Holland is indeed possible even if you are not a resident of the country. However, there are several important considerations to take into account when doing so. One of the first steps in forming a company in Holland is the completion of a KYC identification process, in which the applicant must provide proof of identity and address. This is a crucial part of the process for all potential company founders, regardless of their residency status. Additionally, a visit to the notary is required in order to officially register the company, which may present logistical challenges for non-residents. However, Holland does offer a remote identification process via webcam, allowing non-residents to complete the necessary identification and verification steps from the comfort of their own location. This remote identification process provides a convenient solution for individuals who may not be able to easily travel to Holland for in-person notary appointments. Despite these challenges, it is important to note that forming a company in Holland as a non-resident is still entirely feasible, thanks to the availability of remote identification services. It is also worth mentioning that while there may be additional complexities involved in forming a company as a non-resident, the Dutch government does not discriminate against non-residents when it comes to company formation. Therefore, with the proper documentation and completion of necessary procedures, non-residents are able to establish and operate companies in Holland. Ultimately, the process of forming a company in Holland as a non-resident requires careful consideration and adherence to specific procedures, but with the right approach, it is a viable option for individuals seeking to do business in the country.
Global Entrepreneurship.
Simplified.
How to open a business in the Netherlands according to your origin business structure, as a branch registration
Opening a business in the Netherlands as a branch registration requires a meticulous understanding of the differences between a branch and a subsidiary. A branch registration entails establishing a physical presence of an existing foreign company in the Netherlands, without creating a separate legal entity. This means that the foreign company remains fully responsible for the activities of the branch, including any legal and financial obligations. On the other hand, a subsidiary involves setting up a new legal entity in the Netherlands, which has its own legal and financial responsibilities separate from the foreign parent company. When considering a branch registration, it is essential to comprehensively evaluate the implications of such a decision on the foreign company's operations and liabilities. It is important to note that a branch may be more suitable for companies looking to maintain full control over their Dutch operations, as it directly reflects the parent company's objectives, strategies, and policies. Additionally, it is imperative to thoroughly assess Dutch regulations and requirements for branch registration, as specific regulations may vary depending on the country of origin and the type of business structure. In order to successfully open a business in the Netherlands as a branch registration, one must adhere to a series of stringent legal and administrative procedures, including registering with the Dutch Chamber of Commerce, obtaining a Dutch business bank account, and complying with local tax and employment regulations. It is also crucial to prepare detailed financial statements and provide evidence of the foreign parent company's financial stability and operational history. Furthermore, a comprehensive understanding of Dutch labor laws and employment contracts is essential when hiring employees for the branch. Overall, opening a business in the Netherlands as a branch registration requires a meticulous understanding of the legal, financial, and operational implications, as well as adherence to a series of complex administrative procedures and regulations.
What other kind of companies are available for company formation in the Netherlands?
When it comes to company formation in the Netherlands, there are several different types of companies available to entrepreneurs. One popular option is the private limited company, known as a "besloten vennootschap" (BV). This type of company offers limited liability, which means the owners are not personally responsible for the company's debts. Another option is the public limited company, or "naamloze vennootschap" (NV), which is typically reserved for larger businesses and allows for publicly traded shares. For those looking for a more flexible and informal business structure, the Dutch partnership, or "vennootschap onder firma" (VOF), may be a suitable option. This type of company allows for multiple partners, each of whom is personally liable for the company's debts. Additionally, there is the option of sole proprietorship, or "eenmanszaak," which is the simplest form of business and allows the owner to have full control over the company. Finally, there are also cooperative companies, foundations, and associations, each with their specific legal requirements and purposes. Each type of company has its own advantages and drawbacks, so it is essential for entrepreneurs to carefully consider their business goals and needs before deciding on the most suitable structure. Additionally, it is crucial to seek professional legal and financial advice to ensure compliance with Dutch regulations and tax laws. Regardless of the type of company formation chosen, all businesses in the Netherlands must register with the Chamber of Commerce and adhere to the country's corporate governance and reporting requirements. It is also important to note that company formation in the Netherlands can be completed entirely online through the Dutch Trade Register, making the process more accessible and efficient for entrepreneurs. Understanding the different types of companies available for formation in the Netherlands is crucial for entrepreneurs looking to establish a business in the country and ensures that they can make informed decisions about the most suitable structure for their specific needs and goals.
Request the PDF of this Roadmap to
The Netherlands
Select a Dutch legal business structure for global entrepreneurs
The option of Dutch branch registration is highly inviting for foreign firms desiring to enter the Netherlands' market. The country's inherent entrepreneurial spirit, coupled with an openness to global commerce, makes it an ideal location for entrepreneurs worldwide. It's no wonder that Dutch branch registration is one of the most flexible avenues for leveraging this promising market.
The standout component of this option is the flexibility it provides. Dutch branch registration enables foreign companies to partake in trade activities without the burden of forming a local company completely. This approach favors organizations that aim to evaluate the Dutch market's suitability, sans binding ties or intimidating setup procedures. Furthermore, for certain businesses, there may not be a need to establish any local entity or register a branch to carry out core operations. Activities such as applying for a VAT number or hiring a staff member can be executed without the necessity to form a local entity or branch, further underscoring the system's inherent flexibility.
How quickly can I start my Dutch company?
Incorporating a company in the Netherlands can be a relatively quick process, especially when compared to other countries. The entire procedure can typically be completed within a matter of weeks, provided that all necessary paperwork is in order and the correct steps are followed. Firstly, you will need to decide on the legal structure of your company, whether it’s a sole proprietorship, partnership, limited liability company, or a public corporation. Once this decision has been made, you will need to choose a unique name for your company and ensure that it complies with Dutch naming regulations. This process can take some time as the name must be approved by the Dutch Chamber of Commerce. Then, you will need to draft articles of association for your company, which will outline the internal rules and regulations for the business. These articles will need to be notarized and registered at the Dutch Chamber of Commerce. Additionally, you will need to open a business bank account and deposit the share capital. Once these steps have been completed, you can then file an application with the Chamber of Commerce to officially incorporate your company. While the overall timeline for incorporating a Dutch company is relatively short, it’s important to note that the actual processing time can be influenced by external factors such as government processing times and the complexity of the business structure. It’s also crucial to ensure that all required documents are filled out accurately and completely to avoid any delays in the process. Additionally, seeking professional legal and financial advice can help facilitate the process and ensure that all necessary steps are taken in a timely manner. While the process of incorporating a Dutch company may seem straightforward, it's essential to approach it with diligence and attention to detail to ensure a smooth and timely incorporation process.
The Company Formation Procedure in the Netherlands (legal entity: BV)
Starting a private limited company (BV) is a common choice for entrepreneurs starting a business in the Netherlands. It's preferred for small to medium-sized businesses. Here is a detailed, step-by-step procedure to help you understand how to form one:
Step 1: Lawfully verify your BV's name
Chosen name for your company will be verified by the Dutch Chamber of Commerce (KVK) to ensure it's unique and lawful.
Step 2: Identify your stakeholder and corporate roles
Every BV must have at least one shareholder and may also require directors and a supervisory board, depending on how it’s structured.
Step 3: Prepare your Articles of Association
These are official documents that outline the purpose of your company and how it will operate in detail. It also includes the description of management structure, the amount of share capital, and procedures for making decisions. It must be created in Dutch and notarised by a Dutch notary.
Step 4: Register your BV with the KVK
Once your Articles of Association have been authenticated by the notary, you must then register your BV with the KVK. There will be a fee for registering.
Step 5: Get your Tax Identification Numbers
After successful registration with the KVK, your company will automatically be assigned a VAT number by the Dutch Tax Administration. If you have employees, then you may also need to apply for a wage tax number.
Step 6: Open a corporate bank account
Opening a corporate bank account is a necessary step to handle your business finances and tax obligations. Offering a BV’s deeds of incorporation and registration certificate from the KVK usually is enough. Some banks might request additional documentation.
Step 7: Set up your accounts and administration
It's required by Dutch law for BVs to maintain accurate and up-to-date records of financial affairs. A well-organised system for your books would greatly facilitate annual reports along with tax return submissions.
Note: The procedure described here provides a general guideline. Each case can vary depending on individual situations and therefore may have additional steps, for example, acquiring necessary licenses or permits specific to the industry or type of business.
Company formation costs in the Netherlands
So, what are the costs associated with setting up a business in the Netherlands? The fees for the registration vary depending on whether you’re setting up a branch at the Dutch Chamber of Commerce (KvK) or registering a Dutch private limited company (Besloten Vennootschap or BV) through a notary.
Firstly, if you're registering a branch, the Dutch Chamber of Commerce charges a one-time registration fee of approximately €50. This fee is applicable for all business types - including branches, private limited companies (BV), partnerships, and sole proprietorships. However, keep in mind, there may be additional costs if you require professional legal assistance or translation services during the process.
On the other hand, if you're setting up a Dutch BV, the costs can be higher. This is mainly because the incorporation of a BV requires notarization of the deed of incorporation in the presence of a Dutch notary. Professional fees can vary widely, depending on the notary, intricate details of your business, and time spent but you can expect it to be in the range of €500 to €1500. Apart from notary fees, additional costs may include fees for legal advice, drafting statutes, and potential translation services.
Bear in mind, these are just the initial costs. There may be other costs you will need to consider, such as annual accountancy fees, taxation management and general running costs. It’s always important to research your individual situation thoroughly to avoid any unexpected expenses and ensure a smooth business launch.
Company Formation Netherlands: The Procedure for Non-residents
If you're a non-resident considering starting a company in the Netherlands, here's the good news: it's entirely feasible. In fact, the process is not that complex. Below, you'll find a straightforward guide that will make things clearer and easier for you.
Step 1: Choose a Business Structure First, you'll need to choose a suitable business structure, such as a BV (Private Limited Company) or NV (Public Limited Company). Each has its own implications in terms of liability, tax, and capital requirements.
Step 2: Choose a Unique Company Name The uniqueness of your company name is essential as it distinguishes your business from others. Make sure to check the Dutch Chamber of Commerce (KVK)'s trade registry for name availability.
Step 3: Draft Your Articles of Association This is a legal requirement for the business registration process. The Articles of Association, prepared by a Dutch notary, outlines your business operations and the rights and obligations of shareholders.
Step 4: Register Your Business After finalizing the above steps, you'll need to register your new business with the KVK. This can be done online, by post, or in person. After successful registration, the KVK will automatically inform the Dutch Tax and Customs Administration, who will assign your business a VAT identification number.
Step 5: Open a Dutch Bank Account Final step involves opening a business bank account in a Dutch bank. This can also be done remotely. This bank account will be vital for your company's financial transactions.
Register with the Dutch Business Register and Dutch Tax Administration
Once you've chosen your business structure and prepared all the necessary paperwork, the next step in establishing your Dutch company is to register it with the Dutch Business Register (KVK) and the Dutch Tax Administration (Belastingdienst). These two organizations are paramount to the successful commencement of your business as they deal with your company's legal and financial aspects.
Registering with the Dutch Business Register (KVK)
The KVK, or Kamer van Koophandel, is the official business register in the Netherlands. All companies in the Netherlands are legally required to register with the KVK. You'll have to submit a fully filled-out registration form, your official ID, and evidence of your business's address. Additionally, the payment of a one-time registration fee is required. After registering, you'll receive a unique KVK number for your business.
Registering with the Dutch Tax Administration (Belastingdienst)
In addition to the KVK, you'll also need to register with the Belastingdienst. This is the organization that handles all tax-related matters in the Netherlands. When you register your business with the KVK, they will automatically inform the Belastingdienst of your company's incorporation. You'll then receive a VAT identification number and a VAT tax number - these are important for your VAT returns and other tax obligations.
Note: The registration processes with the KVK and Belastingdienst are generally straightforward, but it can be confusing for those not familiar with Dutch business laws and the Dutch language. It might be helpful to seek professional assistance to ensure that the process runs smoothly.
Key Points During Registration
Ensure all required paperwork is filled out properly and completely to avoid delays.
Prepare to pay the one-time KVK registration fee (the amount can be confirmed on their official website).
Keep in mind that through your KVK registration, the Belastingdienst will automatically be informed of your business.
Expect to receive a VAT identification number and a VAT tax number from Belastingdienst for tax purposes.
Once you've successfully registered, you can then start your business operations officially. You are ready to take your first steps in the Dutch business world with your new company.
It's important to note that Dutch B.V.'s don't automatically receive a VAT number if the director is a non-resident. In this situation, the location of the B.V. can be questioned by tax authorities, which may bring about certain complications. The director must therefore apply for a non-resident VAT number separately to ensure compliance with Dutch tax policies. It's vital for entrepreneurial success to have a comprehensive understanding of these policies, as they form a crucial part of the larger business environment in the Netherlands.
Reporting changes to the KVK
After registering your company with the KVK, also known as the Dutch Chamber of Commerce, it is essential to keep your information up-to-date. You must report any changes in your business activities, management, address, or legal structure. Here's how to navigate these responsibilities:
Business Activities: If your company diversifies or changes its core activities, you must quickly inform the KVK. This will ensure that your business is classified correctly within the Dutch Standard Commercial Classification code.
Management: Any changes in management, such as the appointment of new directors or changes in the board, must be reported to the KVK within a week. This also applies if your company's legal representation changes.
Address: If your business relocates within the Netherlands or moves its official headquarters, you must report this change to the KVK as well. This is crucial as a number of important documents and forms will be sent to your company's registered address.
Legal Structure: Any changes to your company's legal structure, such as changing from a sole proprietorship to a BV, must also be reported. Changing the legal structure of your company can have significant tax and legal implications, so it's crucial to keep the KVK informed.
To report these changes, you'll need to access your company's online KVK profile and submit the necessary forms digitally. It's recommended to make any changes promptly to ensure your company remains in compliance with Dutch business law. If you're unsure what changes to report or how to do so, professional legal advice can be help. Remember, while keeping your company information current might seem like housekeeping, it's a crucial step in maintaining your business's legal and financial health in the Netherlands.
Taxation of companies in the Netherlands
Understanding the taxation system of the country you are planning to start a business in is crucial for accurate budgeting and financial planning. In the Netherlands, several tax obligations apply to businesses. Let's delve into the primary types of taxes your company will be subject to.
Corporate Income Tax (CIT)
Companies established in the Netherlands are liable for Corporate Income Tax (CIT) on their worldwide income. However, non-resident companies with business operations in the Netherlands are taxed only on the income earned within the country. Currently (2024) , the CIT rate is tiered:
Companies with a taxable amount up to €200,000 are taxed at a rate of 19%
Companies with a taxable amount exceeding €200,000 are taxed at a rate of 25,8%
Value Added Tax (VAT)
Value Added Tax (VAT) refers to an indirect tax applied to the consumption of goods and services in the Netherlands. It is charged at each stage of the supply chain from production and distribution, to the final sale. In the Netherlands, the standard VAT rate is 21%. However, a reduced rate of 9% applies to certain goods and services, including food, medicines, books, and newspapers. A 0% rate may apply for certain international transactions.
Dividend Tax
Companies in the Netherlands are subject to a 15% withholding tax on dividends, which is deducted from the profit they distribute to shareholders. However, under certain conditions, treaties and Dutch fiscal investment institutions can reduce or even exempt these taxes.
Payroll Taxes
Employers in the Netherlands are responsible for withholding payroll taxes from their employees’ wages. This includes wage tax (which is an advancement of income tax) and social security contributions.
Other Taxes
Companies in the Netherlands may also have to pay other taxes, such as local taxes imposed by municipalities, water board taxes, and environmental taxes.
With proper planning and understanding of the Dutch tax system, businesses can ensure compliance, resulting in smooth financial operations.
Tax incentives for those who open a business in the Netherlands
Entrepreneurs starting a business in the Netherlands can benefit from numerous tax incentives designed to stimulate business growth. A few prominent ones are highlighted below:
Innovation Box Regime: Known previously as the Patent Box, this regime offers a preferential tax regime for profits earned from innovative activities. This means that a lower effective tax rate applies to a certain portion of the profits derived from qualifying intangible assets.
Wage Tax Reduction Schemes: The Dutch tax system encourages R&D (Research and Development) by providing wage tax benefits for organizations investing in research and innovation. This can result in considerable financial benefits for your business.
0% Facility: For highly skilled migrants employed in the Netherlands, employers can offer a tax-free allowance amounting to 30% of the employee's gross salary, resulting in significant tax savings.
The facility is being abolished.
Besides these, the Dutch government offers several investment allowances, like the Energy Investment Allowance (EIA) for sustainable energy and energy-saving projects, or the Environment Investment Allowance (MIA) for investments in environmentally friendly assets. Such incentives make the Netherlands a lucrative location for entrepreneurs looking to establish a green business. The Netherlands has a strong startup ecosystem with access to venture capital and support programs.The Dutch government offers various incentives for foreign investors and startups.
How easy is it to hire personnel in Netherlands?
Hiring personnel in the Netherlands is relatively straightforward. The Dutch workforce is characterized by a high level of education, excellent command of English, and a flexible mindset. The recruitment culture of the Netherlands is based on mutual compatibility and professionalism. The Netherlands has a highly skilled and multilingual workforce.
Professional Recruitment Agencies: The Netherlands is home to numerous professional recruitment agencies that specialize in different sectors and levels of employment. These agencies have extensive knowledge and reach in the Dutch job market, making it easier for new businesses to find the skilled personnel they require.
Labor Market: The Dutch labor market is one of the most flexible in Europe with a wide availability of both part-time and full-time contracts. This allows companies to recruit and organize their workforce in a manner that suits their organization best.
Digital Hiring Platforms: Internet job portals, professional networking sites, and social media are widely used in the Netherlands. Posting job advertisements online can allow businesses, particularly startups, to reach a wide range of potential employees.
It is also important to note that the Netherlands has specific labor laws that must be followed during the recruitment process. These laws cover areas such as non-discrimination, data privacy, and fairness in employment contracts. To ensure compliance, it may be beneficial for companies to seek local legal consultation or assistance from HR service providers.
Starting a business in the Netherlands also involves understanding and adapting to the wage structure and employment policies of the country. The Dutch labor system is highly protected with a significant degree of worker rights and regulations. The country features a government regulated minimum wage system that ensures a decent compensation for all workers. This is of particular relevance for entrepreneurs, given that company wages in the Netherlands are comparatively high in relation to many other countries.
Adding on to the wage system, the Dutch law also presents a unique feature in terms of its sickness policy. In case of an illness, employers in the Netherlands are legally obliged to continue paying their employees for a period of up to two years. This offers substantial protection to workers but also brings considerable responsibility and liability to businesses.
As a result of these regulations and the overall high wage standards, it should not be surprising to find a certain level of discontent amongst employers. A number of businesses in the Netherlands express dissatisfaction over the complexity and financial burden imposed by regulatory obligations related to hiring staff. This includes the high cost linked to wages, sickness benefits, and the tax implications of appointing new employees.
However, while these regulations might seem burdensome for the companies, they also reflect the Netherlands' commitment to a fair labor market. It is hence essential for entrepreneurs considering the Dutch market to take a structured approach towards workforce planning and budgeting, as well as compliance with local labor laws, to ensure the successful and sustainable operation of their business.
In general, the ease of hiring in the Netherlands, coupled with a skilled and diverse workforce, contributes towards making the country a great place for establishing and growing new businesses.
How House of Companies can help you
Start your Business in the
Netherlands
Write a title here. Click to edit and add your own.
This is a paragraph area where you can add your own text. Just click “Edit Text” or double click here to add your own content and make changes to the font. It's a great place to tell a story about your business and let users know more about you.