Step-by-step plan: starting or taking over a business in the sex industry

Entrepreneurs who intend to stay in the Netherlands must meet several requirements. If you are from outside the European Economic Area (EEA), you may require a residence permit. Our interactive tool Moving to the Netherlands as an entrepreneur can help you find out what you need to check in your situation.

Are you from a country outside the EEA? And do you want to work as an independent operator in the sex industry in the Netherlands? Then you must have a valid residence permit allowing residence for a self-employed professional or another residence permit including the endorsement 'Work is freely permitted' (Arbeid is vrij toegestaan).

Prepare a business plan in which you describe your plans. This way you can see whether your plans are feasible. Many municipalities will only give you an operating permit if you present a good business plan. Describe what you have arranged for:

• supervision
• hygiene
• health
• the independence of sex workers
• combating human trafficking
• safety
• working conditions
• limiting public nuisance

In your plan, you should also explain the prices you intend to charge for your services.

Check how you can register in the KVK Business Register. You can register a sole proprietorship (eenmanszaak) or a general partnership (VOF) with KVK yourself. To set up a private limited company (BV), you must use a civil-law notary.

Can you arrange the registration yourself? If so, complete the KVK registration form online. You will need the following:

• DigiD account
• citizen service number (BSN)
• know the type of legal structure you want to register
• company name
• business (visiting) address
• home address

Once you have completed the registration form, you will need to make an appointment to finalise your registration at a KVK office. For a BV, the civil-law notary will arrange the registration in the Business Register.

Register with KVK

KVK passes your details on to the Netherlands Tax Administration

You do not need to register your business separately with the Netherlands Tax Administration. If the Tax Administration regards you as a VAT-registered business, you will be sent your VAT tax number and your VAT identification number (VAT ID) within a few weeks.

You will need an operating licence for a sex business. You can apply for this online with the municipality where you want to establish the business. The municipality determines, via the general municipal by-law (APV), where you are permitted to open a sex business. Strict rules apply. If you are taking over an existing business, you must apply for a new licence.

The municipality will often carry out an integrity check under the Public Administration Probity Screening Act (Bibob) as part of your application. This involves an investigation into your background and your business plans.

Find out what information you need for the licence application (in Dutch).

There are 3 ways in which you can employ sex workers for your business:

• You hire self-employed sex workers.
• You use the ‘opting-in’ scheme. In that case, the worker is neither self-employed nor an employee, but the same rules apply to payroll taxes as for salaried employment. Find out more about this scheme in Dutch.
• You become an employer with salaried employees. In practice, this type of employment is rare in the sex work sector.

Whatever type of employment you choose, you must ensure a safe working environment for the people who come to work for you. And sex workers always decide for themselves which sexual acts they will and will not perform with clients. You must never force sex workers to work for you.

If you work with self-employed sex workers, you must avoid false self-employment situations.

Do you want to work with foreign sex workers? If so, check whether they are permitted to work in the Netherlands.

Check the age of sex workers

Sex workers must be at least 18 years old. In many towns and cities, the age limit has been raised to 21. Check the age requirement in your municipality. And verify that sex workers are old enough before they start working for your business.

How does the ‘opting-in’ scheme work?

If the sex worker is not self-employed, you can agree with them to use the ‘opting-in’ scheme. You will then deduct payroll taxes and pay this to the Tax Administration. You pay the sex worker a net wage. The Tax Administration refers to this as a ‘fictitious employment relationship’.

To use the scheme, you and the sex worker must both complete the Tax Administration’s form ‘Opting-in Declaration for Payroll Taxes’ (in Dutch). The sex worker sends the form to the Tax Administration.

Important information about salaried employment

In practice, this form of employment is almost never used in sex work. This is because sex workers always decide for themselves which activities they will and will not perform and are entitled to refuse clients.

Do you want to employ staff on a salaried basis for other types of work in your business? If so, you must follow the rules for hiring staff. Among other things, you must register with the Tax Administration as an employer. You must also set out agreements regarding salary, the place of work, and the number of hours per day or week with the employee.

You must follow the hygiene rules for sex businesses. These are set by the National Institute for Public Health and the Environment (RIVM). They contain guidelines on:

• safe sex and personal hygiene
• cleaning and disinfecting the premises and equipment
• layout of the premises
• providing information and rules of conduct

Do you need advice on working safely and healthily? Please contact the Municipal Health Service (GGD) in your region (in Dutch).

Sex workers are entitled to a safe workplace

Sex workers have the right to work in a healthy and safe environment. Your business must provide at least the following:

• You must have a safe sex policy. This means you must not advertise unsafe sex and must allow GGD inspections.
• The workspaces must be clean. Sex workers must be able to wash themselves and there must be enough clean towels.
• You must make sure that sex workers are not put at risk by clients. And you must provide help immediately in the event of an emergency. Even in the case of escort services, the workplace (for example, at a client’s home) must be safe.

If you employ staff, a risk assessment and evaluation (RI&E) is mandatory.

You must charge your clients VAT and submit a VAT return. You will receive a letter from the Tax Administration stating whether you must submit a VAT return quarterly or monthly. Everything you need to know about submitting VAT returnsAt the end of a calendar year, you calculate the profit of your business. You must pay tax on this via your annual income tax return. Check which schemes and tax deductions you can use to reduce your tax bill. Everything you need to know about filing an income tax return

You must keep clear business records for your income and expenditure. Make sure your records meet the requirements. For example, you must keep all your invoices and contracts in a safe place.