Step-by-step plan: How to keep business records

All your company details, both on paper and digital, are part of your business records. Examples are:

• cash administration (including draft notes) and receipts
• financial notes, such as the purchase and sales ledger
• interim check calculations
• invoices received and copies of invoices you have sent. Always check that invoices meet the requirements.
• bank statements
• contracts, agreements, and other deals
• agendas and other appointment books
• correspondence, such as letters and emails
• software and data files

You are legally required to keep your administration for 7 years. You can make agreements with the Netherlands Tax Administration (Belastingdienst) about shorter terms.

You have to keep these documents for 7 years:

• debtor and creditor administration: unpaid invoices of clients and suppliers
• administration of purchases and sales: all invoices of purchases and sales
• general ledger administration: all financial transactions such as received payments
• inventory administration: your entire inventory and its value (if you purchase and sell goods)
• cash administration: all receipts for products that you have bought or sold with cash

You must keep data on real estate and rights on real estate for 10 years. Examples of real estate are business premises, storage facilities, and land. Do you sell your goods or services inside the EU to clients who do not file VAT return? And have you chosen for the One Stop Shop (in Dutch)? Then the term is 10 years as well.

You agree with the Tax Administration on how to keep your administration, digitally or on paper. And in how much detail (for example daily transaction lists, counting strips of the cash register). The Tax Administration documents these agreements in writing.

You can also keep your records through online accounting software. This animation shows the options and benefits of online accounting software:

You do not have to keep a record of your hours. But if you want to make use of the private business ownership allowance (zelfstandigaftrek), or the tax relief for new companies scheme (startersaftrek), you need to show the Tax Administration that you comply with the hours criterion:

• You work in your business for at least 1,225 hours per calendar year. This also applies if you start or end the company during the year. Or if you are a part-time entrepreneur.
• You spend more time on your business than to other work. For example, when you are also employed. Did you not have a business for 1 or more years during the past 5 years? Then this criterion does not apply.

You can do the administration yourself or outsource it to a bookkeeper or accountant.

Difference between an accountant and bookkeeper

An accountant:

• usually works for larger companies, but also for SMEs and self-employed professionals (zzp’ers).
• must take out liability insurance and is subject to disciplinary law. An accountant
• must also meet training requirements and delivery and payment terms apply.

If you have more than 50 employees, a turnover of €15 million, and €7.5 million as your balance sheet total, you are legally required to hire an accountant. Smaller SMEs and self-employed professionals often opt for a bookkeeper (boekhouder).

A bookkeeper:

• is not required to take out liability insurance
• decides for themselves whether they will only assist with business administration or also provide advice