Who submits a VAT return?
Is your business registered with the Netherlands Chamber of Commerce KVK? And have you been issued with a VAT identification and VAT number? You most likely have to file VAT returns. There are some exceptions: for example, if you participate in the small businesses scheme KOR (see below). Or if the goods or services you provide are exempt from VAT, such as childcare and the services of funeral directors. You do not charge VAT on these goods or services, and this usually means deduction of paid VAT is not possible.
Non-resident businesses doing business in the Netherlands may have to file a VAT return as well. Use the Registration of Non-Resident Entrepreneurs Aid to find out if registration in your case is necessary. If so, you must use the Application for VAT identification number for foreign entrepreneurs form (PDF).
Filing your first VAT return
Once you have registered your company with KVK (resident companies) or with the Tax Administration (non-resident companies), the Tax Administration will send you information about your liability for VAT. They will issue you with:
- a VAT identification number, to use for correspondence and invoices to your customers,
- a VAT number, to use for your dealings with the Tax Administration.
This two-number system is necessary to avoid privacy breaches, as the VAT number may contain the citizen service number of the owner or director of the company.
You will also receive a letter telling you how and when to file your VAT returns, as well as a username and a password for filing digitally. You might have to file your first return on paper; the Tax Administration will inform you.
Statement start-up company
Are you unable to register your company with KVK? For example, because KVK does not see you as an entrepreneur. In some cases (in Dutch) you will have to register with the Tax Administration yourself. You can do this using the form Opgaaf Startende onderneming (pdf, in Dutch).
Filing your VAT return online
You file your VAT returns digitally online. There are several ways of doing this:
- you can login at Mijn Belastingdienst Zakelijk on the Tax Administration website (Dutch only). If you login as a legal entity, you need eHerkenning to do so;
- you can also file your return using software applications from commercial parties. Be aware that the software must comply with Standard Business Reporting (SBR);
- you can also hire the services of a tax representative, who will conduct all your dealings with the Tax Administration on your behalf.
Monthly, quarterly or yearly?
The Tax Administration will notify you how often you have to file a VAT return: monthly, quarterly or yearly. The Belastingdienst will also inform you of the ultimate filing date. You can find a complete overview on their website (in Dutch).
The most common frequency is quarterly. If you want to file your returns on a monthly or yearly basis, it is possible in certain conditions. Send a letter to the Tax Administration to arrange this.
Make sure to submit and pay on time
Always make sure to file your return on time. You need to keep an eye on the declaration and payment deadlines (in Dutch) yourself. If you fail to file or pay a tax return or pay on time, you will receive an additional tax assessment. Read more about additional VAT assessments.
Always file a return: zero declaration
You must always file a VAT return. Even if you had no turnover in a period. Or if you did not receive or pay VAT. This is called a zero return or 0 return (nihilaangifte).
Filling out the VAT return
You use the VAT return to declare the VAT you have charged to your customers. You also declare the amount of VAT you have paid to your suppliers. You also file VAT that has been reverse-charged to you. Has another entrepreneur reverse-charge VAT to you? You also state this in the tax return. Calculate the amount you have to pay or receive in your tax return form. If you have to pay, you have to transfer the money directly, before the VAT return due date. You will not receive a tax assessment from your VAT return.
Cash accounting or invoice accounting
You calculate the VAT using cash accounting (kasstelsel) or invoice accounting (factuurstelsel). Are your customers mainly entrepreneurs and legal entities, such as foundations and associations? Then you use invoice accounting. You then state the VAT that you have charged to your customers. Even if a customer has not yet paid his bill during the declaration period.
Cash accounting is for entrepreneurs who mainly supply private individuals. You declare the VAT on the income that has been credited to your bank account. Or that you received in cash.
Rates and Exemptions
There are different rates for VAT. Some industries and activities are exempt from VAT.
VAT deduction as input tax
You usually pay VAT on goods or services that you purchase for your business. You may deduct this VAT as input tax in your VAT return (in Dutch). For some expenses you may not deduct the VAT. Read when you are not allowed to deduct VAT (in Dutch) on Belastingdienst.nl.
In the last VAT return of the year, you state the VAT for the private use of:
- company car
- gas, water, electricity and telephone
- business assets
Read more about calculating VAT in the Explanatory notes to the sales tax return (in Dutch) on Belastingdienst.nl.
Are you eligible for the Small Businesses Scheme (KOR)?
Entrepreneurs with an annual turnover that does not exceed €20,000.- can participate in the small businesses scheme (kleineondernemersregeling, KOR). When you participate in the KOR, you do not have to file VAT returns. To participate, you have to apply by filling in a form and send it to the Tax Administration 4 weeks before the start of your next filing period. If your annual turnover does not exceed €1,800.-, you can simply use the scheme without applying beforehand and without the mandatory 3-year period of using the scheme.
Exempt from VAT requirements
Are you exempt from administrative VAT requirements (in Dutch)? Then you participate in the small businesses scheme automatically. If you want to stop participating, you must notify the Tax Administration. You can do so at any time.
Find out if you are eligible for special VAT arrangements
The Netherlands applies special VAT arrangements to:
- Profit margin arrangement: if you deal in second-hand goods, you may be eligible for this arrangement. It means you only have to pay VAT on the difference between the sale price and the purchase price.
- Travel agency arrangement: If your services are eligible for the travel agency arrangement, you pay VAT on the profit margin for travel services, instead of on the total price.
- Reverse-charge arrangement: Under the reverse-charge arrangement, you do not charge VAT, but reverse-charge it to your buyer.
VAT return for services to or from abroad
Do you supply services to a foreign country or purchase services from abroad? You may have to declare part of the VAT paid or charged for these services in the Netherlands and part in the country you are doing business with. You can find more information on the Tax Administration website (in Dutch).
Correct mistakes in your next VAT return
Mistakes happen; for instance, you may have overlooked an invoice in your latest VAT return. It’s not a problem. You can correct the mistake in your next VAT return, if the difference in the amount you have to pay or are due to receive is less than €1,000. If it is more, you’ll have to file an additional return, a so-called Suppletie-aangifte. You can find the form in the encrypted (Dutch only) entrepreneurs’ environment on the website of the Tax Administration.