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VAT and income tax for self-employed professionals

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Netherlands Enterprise Agency, RVO | Tax and Customs Administration, Belastingdienst

Just like other entrepreneurs, freelancers/self-employed professionals must register with the Dutch Tax and Customs Administration (Belastingdienst). They will determine whether you are an entrepreneur for the purposes of turnover tax and income tax.

Entrepreneur for the purposes of turnover tax

VAT (value added tax) is a form of turnover tax. Freelancers/self-employed professionals are almost always considered entrepreneurs for the purposes of turnover tax, which means that they must charge and pay VAT (btw) on their income. If your level of income is low, you may be eligible for the small businesses tax scheme (kleineondernemersregeling). In addition, some services (in journalism and education, for example) are exempt from VAT.

As of 1 January 2020 there have been some changes in VAT numbers. Sole proprietors and self-employed professionals now have 2 VAT numbers: a VAT identification number (btw-id) and a VAT tax number.

Entrepreneur for the purposes of income tax

Being considered an entrepreneur for the purposes of turnover tax does not mean that you will automatically be considered an entrepreneur for the purposes of income tax. The latter requires that you satisfy a number of conditions. If you do not fulfil these criteria and you are not employed by your customer, the Dutch Tax and Customs Administration regards your income as regular incidental earnings. In that case you are not entitled to claim certain tax deductions that are available to entrepreneurs. However, you may claim expenses related to your work.

Model agreement

Freelancers/self-employed professionals and their client can decide, but are not obliged, to use a model agreement to establish an independent business relationship. However, the Dutch Tax and Customs Administration may check retrospectively if the type of relationship meant actual employment or not, even if this was not intended. If so, this may have consequences regarding additional payroll taxes for both freelancer/self-employed professional and client. You can obtain model agreements in English through ZZP Nederland. This is only possible after paying a membership fee.

Tax facilities, subsidies and benefits

As a freelancer/self-employed professional based in the Netherlands you can qualify for a number of benefits and tax facilities and subsidies.

This article is related to:

This information is provided by

Netherlands Enterprise Agency, RVO
Tax and Customs Administration, Belastingdienst