Do you run a small business in the Netherlands with a turnover of no more than €20,000 per year? You can choose to take part in the Small Businesses Scheme (kleineondernemersregeling, KOR).
If you take part in the small businesses scheme KOR, you
- do not charge your customers VAT (btw)
- do not file VAT declarations (in some cases you need to file a one-off VAT return (in Dutch)
- cannot deduct VAT on business costs and investments
If you participate in the small businesses scheme you will not charge your customers VAT and you do not pay turnover tax (VAT) to the Dutch Tax and Customs Administration (Belastingdienst). You will have less administrative duties for the VAT. This scheme applies to all activities in your company, also if you have different sub-numbers for VAT.
Please note: You may need to review VAT deductions if you start or end participation in the KOR (in Dutch).
Who can apply for the small businesses scheme KOR?
The small businesses scheme KOR is a VAT exemption for:
- natural persons or partnerships of these (such as sole proprietors, professional partnership, or general partnership (VOF)
- legal persons (such as foundations, associations, and private limited partnerships (bv’s)
If you want to take part in the KOR you must meet the conditions:
- You are an entrepreneur for VAT.
- Your turnover is at most €20,000 per calendar year. To estimate your turnover you can use the Dutch-language tool on the website of the Dutch Tax and Customs Administration.
- Your business is established in the Netherlands
Check if you are eligible for this scheme with the Dutch-language KOR tool. If you make use the KOR scheme, this is for at least 3 years.
The small businesses scheme is not always financially beneficial. For example if you plan to make investments in the near future. You can find more information in Dutch with the Dutch Tax and Customs Administration (Belastingdienst).
How to apply for the small businesses scheme
You can apply for the small businesses scheme by completing the Dutch-language form Melding omzetbelasting kleineondernemersregeling. Make sure you apply for it at least 4 weeks before the start of the next return period.
Does your turnover not exceed €1,800 per year? And do you not have to register with the Dutch Chamber of Commerce (and you did not register)? You do not have to apply for this measure. You automatically take part in the KOR scheme.
Cancelling participation in the KOR
If you take part in the KOR scheme, this is for at least 3 years. Then, if you no longer want to participate in the KOR scheme, you must cancel your participation (in Dutch) with the cancellation form (in Dutch).
Does your turnover exceed €20,000? In that case you must notify the Tax and Customs Administration (in Dutch) immediately. You will be subject to VAT.