Step-by-step plan: Arranging the business affairs of a deceased entrepreneur
The death of a loved one is always difficult. When the deceased also leaves a business behind, you will have a lot to arrange regarding that business. Read what the most important steps are when an entrepreneur dies.
You must report the death of the entrepreneur to the municipality. Usually the funeral director does this. The municipality automatically passes on the notice of death to the Netherlands Chamber of Commerce, KVK and the Netherlands Tax Administration. After 5 days you will receive a letter of condolence from the Tax Administration as confirmation.
Check if the deceased has a will via the Central Testament Register (CTR, in Dutch).
If there is a will, the CTR will say which notary made it. You can request the will from this notary. Note: Only legal heirs and other heirs named in the will may view the will.
If there is no will, the law determines how the inheritance is divided. In complex inheritances, the deceased will usually have chosen one or more executors. That is someone who arranges the inheritance or certain matters from the will. This can be one of the heirs but also someone else, such as a notary.
The KVK Bereavement Support Team (Nabestaandendesk) helps you arrange practical matters concerning the business. Such as the deregistration of the deceased from the Business Register. Every situation is different, so the KVK Bereavement Support Team provides a personal service.
If you inherit the business, you have to decide what happens to it. There are 3 options:
- You close the business.
- You continue the business yourself.
- You transfer the business to someone else.
After the death, contact the KVK Bereavement Support Team:
- Include your name and telephone number.
- Indicate which KVK registration number it concerns.
An employee of the KVK Bereavement Support Team will contact you as soon as possible. The Business Register is linked to the Personal Records Database (BRP). When someone dies, this information is passed on to the KVK Bereavement Support Team. If you do not contact them, the KVK Bereavement Support Team will contact you around 8 weeks after the death.
Financial institutions such as banks and insurers always ask for a copy of the will (testament) and the death certificate (overlijdensakte) if you want access to funds.
Some financial institutions also require a certificate of inheritance (verklaring van erfrecht). This certificate shows who the heirs are and who is authorised to make decisions. A notary draws up the certificate for you.
A certificate of inheritance states, among other things:
- That someone has died.
- Any relationship with a partner, including in community of property or with a prenuptial agreement.
- If there is a will.
- Who the heirs are.
- If the heirs have accepted the inheritance.
- Who is allowed to arrange the inheritance and decide about the possessions.
You have 3 months to find out information about the deceased's assets and debts before you and any other heirs make a decision. This time is called the right of deliberation.
You have 3 options when it comes to the inheritance:
If you accept the inheritance unconditionally (zuivere aanvaarding), you inherit not only the assets but also the debts. If the debts are greater than the assets, you are liable and must use your private capital. This means that you have to pay the debts from the inheritance with your own money.
In the case of beneficial acceptance, you will receive the inheritance, but you will not be liable for any debts. If there are any debts, all assets of the inheritance must be sold as profitably as possible. With the proceeds, you have to pay off the creditors. Anything left of the inheritance is for the heirs. If the proceeds are insufficient to pay off all debts, you do not have to pay this out of your private capital.
With beneficial acceptance of the inheritance, also called under benefit of inventory, the settlement is more complicated. There are extra rules you must follow. To accept an inheritance beneficially, you must make a statement to the court as heir. You pay a one-time fee (in Dutch) for this. The notary can arrange this for you.
Underage heirs: always beneficial acceptance
Is the heir underage? By law, the minor’s legal representative must always accept the inheritance beneficially on the minor’s behalf.
If you do not want the inheritance, you can reject it. For example, if you expect that there are more debts than assets. In case of rejection, you must state this to the court. You pay a one-time fee (in Dutch) for this. The notary can arrange this for you.
If you reject the inheritance, you are not allowed to make any arrangements after the death. You are not an heir. You are also not allowed to take anything from the inheritance. If you do, you give the impression that you did accept the inheritance.
Read more about accepting or rejecting an inheritance on Rechtspraak.nl, the official website about the judicial system in the Netherlands.
If the business is a general partnership (VOF) or a professional partnership (maatschap) the deceased may have made arrangements with their business partners to ensure that the partnership does not disintegrate upon their death. Terms in the partnership contract may have consequences for the heir(s). Read more about these arrangements on the KVK website.
As heir, you are obliged to take care of all matters associated with the inheritance. This includes the business. If an executor has been appointed, this is the executor's job. You or the executor must get access to both the business administration and the private administration. This is, among other things, necessary for the settlement with the Tax Administration.
You cannot view this video due to your cookie settings. Would you like to watch?or Watch this video on YouTubeHow cookies are used on Business.gov.nl.Report the death to financial institutions where the entrepreneur was a customer, such as banks, credit card companies, insurers, investment institutions, and pension funds. With a declaration of executorship and/or certificate of inheritance you prevent that money from the entrepreneur is blocked. Such as the balances on payment cards, credit cards, and online banking.
21 days after the death, the Tax Administration will send a letter asking you to provide a contact person. And you will be asked to file an income tax return.
You will also receive an invitation to file an inheritance tax return. Everyone who receives something from the inheritance has to pay a percentage of the received inheritance. This percentage depends on:
- the value of the inheritance, including the business.
- the relationship with the entrepreneur. For example, a spouse or children pay a lower percentage than other heirs.
Will you continue the business, alone or with someone else? In that case, you usually do not have to pay inheritance tax. If you continue a business that you received through a gift or inheritance, €1.5 million of the value of the business is exempt from gift or inheritance tax. Some conditions do apply (in Dutch).
If you continue the business, you must do so for at least 3 years. And you adhere to the business succession scheme, BOR. If you do not do this, the Tax Administration will charge inheritance tax on the business.
For the Tax Administration, termination means that you will end the business (staken, in Dutch). The Tax Administration will send you the final tax return. The form you use for this is called the F form (F-biljet). This is the business’ final statement and income tax return.
The value of the business is also determined by this declaration.
Tax Helpline for surviving relatives
Do you have any questions about inheritance, inheritance tax, income tax and benefits? If so, please contact the Tax Helpline for surviving relatives: 0800 235 8354 (free of charge)
When you decide not to continue the business, check which insurance policies and contracts you need to cancel. For example:
- Telephone contracts
- Domain name (in Dutch)
- Website
- Social media accounts
- Subscriptions
- Contracts with suppliers and other parties