With the right process and guidance, it can be a straightforward journey to register your branch in the Netherlands. Specifically, if you plan to venture into the Netherlands market, setting up a branch is an excellent way to start. This guide provides you with ten insightful tips about registering a branch in the Netherlands without involving a local accountant or lawyer.
Use the Entity Portal of House of Companies to get familiar with the business forms, and registration procedure
Become familiar with corporate taxes in the Netherlands
Check if you need, or a legally obliged to apply for a VAT number in the Netherlands
Create a Compliance Calender on your Filing requirements in the Netherlands (included in your Entity Portal!)
Open a Local Bank Account, save on Forex transactions, and processing time (included in our branch registration service!)
Use a virtual office address if you don't need a fully fledged office yet! You will save tons of money.
Become familiar with the Tax Portal of the Dutch belastingdienst.nl so that you can easily submit your VAT returns yourself, especially if you hardly have any turnover, or complex transactions. Our playbooks guide you all the way!
Apply for e-herkenning (eresidency) for your Company in the Netherlands, to have direct access to government portals, and not become dependent on any agent. Houseofcompanies.io provides a full playbook on how to obtain your eherkenning in the Netherlands.
File your (abbreviated) Financial Report at the Chamber of Commerce (kvk.nl) using your eherkenning, to avoid having to use any Dutch accounting software.
If your company is dormant, or has very few transactions; Dont create any Annual Statements. Instead, use the Tax Filing software of the tax authorities in the Netherlands (belastingdienst.nl) to submit your corporate tax return, and prepare a balance sheet at the same time! Houseofcompanies.io provides a full playbook on this corporate tax filing process in the Netherlands.
Our tips about branch rgeistration in the Netherlands in more detail:
Understanding Different Types of International Entities
It's crucial to understand the various forms of international entities or foreign legal entities before deciding on the best fit for your business. An international entity is the foreign arm of a domestic company created for global expansion. There are primarily three types of foreign entities:
A representative office is a minimal presence in a foreign country. Employees working in a representative office only act as company representatives and do not engage in sales or contracts. This type of office is often the first step before more extensive global expansion.
A branch office is an extension of your company. It is wholly owned by your company, and its taxes and other administration are handled according to your home country's laws. The branch office offers more flexibility but can expose your company to greater legal liability.
A subsidiary is a separate legal entity owned by the parent company. This status shields the parent company from legal liability in the host country. A foreign subsidiary has many advantages, such as the ability to branch out deeper into foreign markets and more international credibility.
Requirements for Setting Up a Dutch Branch
Establishing a Dutch branch involves several requirements:
Registration: You must register your branch with the Dutch Business Register (Handelsregister) at Kamer van Koophandel (KvK).
Local Address: Your company must have a local address in Holland.
Legal Entity Structure: Your branch automatically has the same legal structure as the parent company.
Tax Registration: You must register with the Dutch Tax Administration.
The Benefits of Setting Up a Dutch Branch
There are several benefits to setting up a Dutch branch:
Market Presence: Setting up a branch office in the Netherlands gives your company a foothold in the country, allowing you to do research and explore the possibility of further expansion.
Flexibility: A branch office grants more flexibility in your international business but can also open your company to greater legal liability.
Tax Advantage: If your branch office is a permanent establishment, it will be liable for corporate tax and VAT in the Netherlands.
The Legal Implications of a Dutch Branch
Understanding the legal implications is crucial when setting up a Dutch branch. The branch office automatically has the same legal structure as the parent company, meaning you're governed by your home country's laws for the most part. However, you still need to comply with Dutch taxation laws.
Taxation for Dutch Branch
Understanding the taxation system of the Netherlands is crucial for any foreign business. The corporate tax rate in the Netherlands is either 20 or 25%, depending on annual profits. In addition, companies with branches in the Netherlands may also be subject to dividend tax.
Using Entity Portal of House of Companies
One of the most effective ways to register a Dutch branch is to use the Entity Portal of House of Companies. The portal offers a comprehensive guide on business forms and the registration procedure, making it easy for entrepreneurs to navigate the registration process.
Understanding Corporate Taxes in the Netherlands
Before setting up a Dutch branch, it's crucial to understand the corporate taxes in the Netherlands. The corporate tax rate is either 20 or 25%, depending on annual profits. Understanding these rates can help you better plan your financial strategy.
VAT Number in the Netherlands
A VAT number is essential for any business operating in the Netherlands. This number is used for tax purposes and is required for the VAT returns you need to file. You need to apply for a VAT number as part of the branch registration process.
Choosing Between a Representative Office, Branch Office, and a Subsidiary
Your choice between a representative office, branch office, and a subsidiary will depend on your business needs and plans for expansion. A representative office allows for minimal presence and is often the first step before more extensive global expansion. A branch office offers more flexibility but opens your company to greater legal liability. A subsidiary, on the other hand, operates as a separate legal entity and shields the parent company from legal liability in the host country.
Setting up a Dutch branch is a significant step in your global expansion strategy. It's essential to understand the process, the legal and tax implications, and the requirements before embarking on this journey. With these ten tips, you're well on your way to establishing a successful branch in the Netherlands.
Remember, expanding globally can be a challenge you don't have to handle alone. Partnering with a reliable, entrepreneurial, diplomatic, and globally-oriented business facilitator like House of Companies can make the process smoother and more efficient. They offer not just services, but also a community, educational resources, and a simplified business journey for global entrepreneurs. House of Companies' core product is 'Entity Management', offered as a Software as a Service. As part of their Entity Management membership, they offer free branch registration, with a guaranteed bank account opening. Their branch registration service is the most flexible and cheapest available in Europe, ideal for Bol.com, Amazon Sellers, and other ecommerce companies.
In the world of business, the sky is the limit. Don't let borders hold you back. Set your sights on the Netherlands and let your business soar.