Netherlands - Corporate Tax

Corporate tax

  • Once the BV is setup there are certain obligations and tax returns which need to be filed.
  • An administration system must be set up and kept up to date.
  • VAT returns must be filed.
  • A corporate tax return must be filed every year.
  • Wage tax returns plus forms concerning social security must be filed for all employees.

Resident corporate taxpayers

Resident corporate taxpayers are subject to Dutch corporate tax on their worldwide income. Such companies may also be subject to foreign corporate tax on their profits earned outside the Netherlands.

In order to avoid double taxation, Dutch tax law contains various rules that exempt income that has already been taxed or is subject to taxation in another country. This avoidance of double taxation is provided for in the participation exemption, bilateral tax treaties, or the Unilateral Decree for the Avoidance of Double Taxation. Non-resident corporate taxpayers are non-resident entities which receive income from certain specified Dutch sources such as:

  • Business income from a Dutch permanent establishment or representative.
  • Income from property located in the Netherlands.
  • Non-resident corporate taxpayers are normally subject to the corporate tax for their Dutch-source income.

Corporate tax law

In recent years, the Dutch fiscal system has been modernized, making for an even more attractive corporate climate. And the corporate tax rate, currently at 25.5%, is expected to drop even further. Combining an excellent infrastructure with an attractive fiscal climate and an abundance of client-driven service providers, the Netherlands offers large incentives for internationally oriented companies. The Netherlands also offers a wide range of tax breaks and fiscal practices to further reduce the amount of taxes that needs to be paid.

VAT

Businesses are nearly always liable to charge value added tax to their clients. The rate is 6% or 19% depending on the type of product or service. The VAT which you receive from your client must be paid to the Inland Revenue. The VAT which you have paid out yourself to your suppliers can be offset against this. Value added tax is paid either monthly or quarterly, depending on the type of business you have and the level of turnover.