Ending your private limited company (bv)

Published by:
Netherlands Chamber of Commerce, KVK
Netherlands Chamber of Commerce, KVK

If you decide to end your private limited company (bv), you must take care of several matters. First, you must dissolve the company. You also have to settle your corporate income tax. And deregister your bv from the Business Register at KVK. Read this checklist to find out how to end your private limited company.

1. Check the agreements with shareholders

Does the bv have more than 1 shareholder? Find out which agreements are in place. You may have concluded a written shareholder’s agreement. Agreements may also be written down in the articles of association. Check the agreements on the distribution of profit and who is liable for losses and debts when ending the bv.

2. Check the financial consequences

When you end your private limited company, you and your partners draw up a final balance (or have it drawn up). This is a final overview of the assets of your bv. The capital must be settled (vereffening) and divided.

Also pay attention to the following points:

Your bv can no longer have any assets, such as stock or machines. Divide the assets that your private limited company has left, such as:

  • outstanding invoices with debtors;
  • money in the bank account;
  • stock;
  • cars and machines;
  • intellectual property rights.

If there is any money left in the bank account after the dissolution and liquidation of the bv, it will in principle go to the shareholders. Unless there is a different agreement in the articles of association.

Transfer the vehicle registration number to your own name

Do you have a vehicle registered in the name of your private limited company? Do not forget to transfer the registration number to your own name when you deregister your company. Read what you must do.

Does your private limited company have loans? Check what the payment terms are. If you cannot fulfil your obligations, then contact the financier and try to find a solution.

Does your bv have lease agreements? For example, for a delivery van or a machine? Check the duration of the contract. Contact the leasing company (lessor) to find out what the options are.

After you have ended the company, you remain liable for risks. For example, you still have to pay off your debts. Therefore, make sure you handle everything properly. Some insurers allow you to include discontinuation risks in a business liability insurance policy. This is called run-off cover, which is the risk of claims after you have stopped.

Cancelling your business bank account

Before you close your business bank account, take care of the following:

  • Download all bank statements and/or the annual financial statement.
  • Stop current debit agreements and periodic transfers.
  • Cancel linked credit cards and insurances.
  • Do you have a G-account? Contact the Netherlands Tax Administration to cancel it.

Ask your bank about the procedure for cancelling a business bank account.

3. See if you are eligible for benefits

If you were born before 1960 and you own a business which is no longer viable, you can apply for a benefit via the Decree on Social Assistance to the Self-Employed (Besluit bijstandverlening zelfstandigen, Bbz). With the help of the Bbz you can receive benefits in addition to your income up to the level of a social welfare benefit. Please note: you must have spent at least 1225 hours per year on your bv. If you were born after 1960, the benefit applies until the limited partnership ends. You can apply for the Bbz benefit at the social services of the municipality where you live.

Are you aged between 55 and the state pension age? Then you may be eligible for the Older and Partially Disabled Self-Employed Income Support (IOAZ). With the IOAZ benefit, your income will be supplemented up to the social welfare level. You must be able to demonstrate that you have too little income to live on. Apply for the IOAZ benefit at the municipality where you live.

Wait before deregistering at KVK

Please note: you must submit the application for Bbz and the IOAZ benefit before you deregister your bv with KVK.

4. Dismissing staff

There are rules that you must adhere to if you employ staff. If you need to dismiss staff, you must apply for a dismissal permit. You must also lay down agreements in a social plan, such as a transition payment and job counselling. Also notify the Netherlands Tax Administration of the dismissal. The Handboek Loonheffingen (in Dutch) tells you what to report in ‘Step 17’.

5. Inform your staff and customers

Do you have staff? Tell them in time that you are going to end your business. This way, your staff can start looking for a job elsewhere. Also check which contracts or agreements you have with customers and suppliers. Do this before you tell them you are ending your business.

6. Dissolving the bv

To cancel your bv, you must dissolve it. This is also known as liquidation. The General Meeting of Shareholders takes a formal decision on dissolving the bv. If there are multiple shareholders, the articles of association will outline what majority of votes will be needed for this decision. Once all shareholders agree, you can decide on the official termination date. You may also choose a date in the future for dissolving your bv.

The process then depends on the following 2 situations: either your bv has assets, or your bv has no assets.

Does your private limited company have no assets? Then you can opt for a so-called turbo liquidation, also known as fast-track liquidation. This is a quick way to end your bv. You need to do the following steps:

1.Complete the form 17a 'Registration Dissolution of legal entity' (pdf) from KVK. You must also provide information about your bv's financial situation. You do this with the form 'Fast-track liquidaton' (pdf).

2. Send both forms, including attachments, by post to KVK. After receipt and approval, the KVK will deregister the bv from the Business Register. KVK notifies the Tax Administration that your bv has been terminated. You will receive a letter from the Tax Administration about the consequences for corporate tax and VAT (see steps 7 and 8). Do you want to apply for a benefit? Then wait a little longer before deregistering (see step 3).

Fast-track liquidation is not without risk. A creditor can demand payment through the courts (liquidation) if it turns out afterwards that there are still assets. As a result, the board may become personally liable, because the legal entity has been dissolved.

Does your bv have assets? Then you take the following steps:

1. Complete form 17a 'Registration Dissolution of legal entity' (pdf) from KVK.

2. The bv goes into liquidation. This means that the assets of the bv must be liquidated (divided).

3. Appoint a liquidator to survey and distribute the assets.

4. The liquidator files the accounts and a plan of distribution with KVK if several members are entitled to assets of the bv.

5. The liquidator shall announce via an advertisement in a newspaper where and until when the deposited documents can be viewed.

6. If the liquidation is concluded and there are no objections, complete form 17b 'Register the end of a legal entity after dissolution' (pdf).

7. Send forms 17a and 17b by post to KVK.

8. After receipt and approval, the KVK will deregister the bv from the Business Register. KVK notifies the Tax Administration that your bv has been terminated. You will receive a letter from the Tax Administration about the consequences for corporate tax and VAT (see steps 7 and 8). Do you want to apply for a benefit? Then wait a little longer before deregistering (see step 3).

Dissolving a bv with outstanding debts

Are you forced to end your private limited company because your company is in debt? Investigate whether you qualify for debt restructuring. For temporary debts, you can first request a postponement (suspension of payment). Do you expect payment problems for taxes and contributions? Notify (in Dutch) the Tax Administration of your inability to pay. If you are still unable to pay off your debts, you must file for bankruptcy.

7. Submit your final VAT return

After the Tax Administration has been informed that your private limited company has been deregistered, you will receive a letter stating that you must submit a final VAT return. Only after you have submitted this final return will the Tax Administration send you written confirmation of your deregistration as an entrepreneur for VAT purposes.

File a tax return even if you have not yet deregistered

Deregistration sometimes takes a while. In the meantime, have you received a message from the Tax Administration that you have to file a VAT return? Make sure to file this return.

8. Pay corporate income tax (vpb)

The Tax Administration will send you a letter confirming the deregistration from the Business Register and the tax settlement. You must submit a final corporate income tax return.

Premises on the balance sheet

A purchased business property is usually part of your business accounts. You will have tax benefits. And you can use the surplus value as working capital for your business. The moment you stop doing business, however, you run the risk of having to settle with the Tax Administration over the increase in the value of the property. On KVK.nl you can read what to look out for when your premises is on the balance sheet.

9. Keep your business records

After ending your limited partnership, you must keep business records for at least 7 years. In some cases, you need to keep them for 10 years. This depends on the type of records. You can find more information on the Tax Administration website (in Dutch). You may also scan the records to keep them digitally. You must appoint a keeper of the books and records. You do so during the General Meeting of Shareholders. Usually, the liquidator is appointed keeper. When deregistering the bv, you (or a representative) register the appointed keeper of the records with the Dutch Business Register.

Questions relating to this article?

Please contact the Netherlands Chamber of Commerce, KVK