Business person for the purposes of VAT
If the Dutch Tax and Customs Administration considers you to be a business person for the purposes of VAT, you must charge VAT to your customers. That is the case if you operate a company or work for yourself, but not automatically. As it happens, the conditions for VAT are different from those for income tax. It could be, therefore, that you are considered a business person for the purposes of VAT but not for income tax purposes.
The legal form of your company plays no role in this. Even a foundation or association can be regarded as a business person for the purposes of VAT. Moreover, they could also be regarded as a business person for the purposes of income tax.
Owning solar panels
If you own solar panels and sell energy back to the grid, you are considered to be an entrepreneur for the purposes of VAT. However, this does not automatically mean you will have to file a VAT return. Please contact the Dutch tax and Customs Administration for more information.
VAT is calculated on the price and all corresponding costs for your goods or services. This includes all shipping costs, travel costs, telephone costs, packaging costs (except refundable deposits) and similar.
In some cases, as a business person, you are not required to charge VAT to your customers. For example, if your goods or services are exempt from VAT, such as childcare and the services of funeral directors. You then do not charge VAT to your customers. Usually, this also means you cannot deduct any VAT either.
If you provide all of the details required by the Dutch Tax and Customs Administration when you register with the Dutch Chamber of commerce, you will be issued with a VAT number immediately.
VAT in your accounts
You must indicate your VAT number on all of your invoices. There are also requirements with which your administration must comply. You must, for example, maintain a summary of all sent and received invoices. Invoices that you send must be numbered in ascending order. Your administration must also show whether you have paid or received VAT.
Goods and services with different VAT rates are best kept separate within your administration. If this is too difficult, you may share the turnover across the various rates on the basis of purchases.
Filing your return
The Dutch Tax and Customs Administration will let you know when you must file your VAT return and make a VAT payment: each month, each quarter or each year. Usually, you will file your return once a quarter. Make sure that you file your return and make the payment on time. In order to help you file your return on time, the Dutch Tax and Customs Administration offers various tips and tools.
Are you a start-up business person? Then you will receive your first return once your business is registered with the Dutch Chamber of Commerce. The first return will often be paper-based. Even if you have no turnover, you must file a return.
You must complete your VAT return digitally. There are several ways to do this. If you are filing a return via the secure section of the Dutch Tax and Customs Administration’s website, you can login with the login details that you received from them. If you have lost your user name and/or password, they will send you new login details at your request.
Complete the form 'VAT return' on the secure section of the Dutch Tax and Customs Administration’s website. You must send it to them on time. You cannot be granted a delay for your VAT return. Indicate your turnover from Dutch customers and the VAT from this turnover (questions 1a and b) on your VAT return. You then deduct the VAT that your suppliers have charged you for purchases, costs and investments (question 5b) in this period.
Have you filled in too much or too little VAT? Then amend your return as quickly as possible.
Turnover tax for entrepreneurs outside of the Netherlands
Different rules apply if your company does not have an establishment in the Netherlands, but does provide goods or services to buyers in the Netherlands, or if you incur costs over which you are charged turnover tax in the Netherlands.
Small businesses scheme
If you are a sole trader or own a Partnership under common firm (VOF) and you pay very little VAT, you may be eligible for the Small businesses scheme regarding VAT. If you fulfil the conditions, this means you may pay less or even no VAT at all. You may also be eligible for an administrative dispensation, meaning that you do not need to file a return.
Dispensation from the obligation to keep records
If you apply the small business scheme and you do not need to pay VAT or you do not expect to pay any VAT in the coming years, then you can request a dispensation from the obligation to keep VAT records.
Margin scheme for traders in second-hand goods
As a trader in second-hand goods you can apply the margin scheme if you purchase without VAT. When you sell these goods you do not charge the VAT on the turnover, but on the difference between sales price and purchase price (profit margin). You only have to pay VAT on this if you sell with a profit. If you sell without a profit you cannot reclaim VAT. You can also use the margin scheme with art, antique and collector’s items which are purchased with VAT.
Travel agency scheme
If you sell travel services within the EU in your own name, your services may fall under the travel agency scheme. This VAT scheme implies, among others, that you pay 19% VAT on your profit margin on travel services, instead of on the total price of the travel service.
Do your services fall under the travel agency scheme?
As a travel agency, tour operator or organiser of fully arranged study trips you fall under the travel agency scheme. If you only mediate with the sale of trips, the travel agency scheme does not apply to you. The travel agency scheme also does not apply to the sale of trips in your own name outside the EU. You apply the 0% rate to the sale of such a trip.
VAT in the case of advertising using stamps and vouchers
If you give your customers stamps or vouchers, you may reduce the amount of VAT depending on the type of stamp or voucher and the moment when it costs you money. As far as VAT is concerned, stamps also include vouchers and bar codes on goods packaging that your customer has to cut out, affix to a card and hand in.
Reverse charge mechanism for contractors and subcontractors
If you are a main contractor outsourcing work to a subcontractor in the construction, shipbuilding, metal construction, clothing or cleaning and waste disposal industries, you must take account of the reverse-charge mechanism. This mechanism provides that you, as the main contractor - rather than the subcontractor - have to pay the VAT on the activities.