Expat Guide to Starting a Business in the Netherlands

If you want to move abroad but you’ve yet to reach retirement age, of course you’re going to have to start thinking about how you’ll earn an income overseas – unless you’re a wealth heir or heiress of course!

For some would-be expatriates, the thought of moving abroad gives them the extra incentive and inspiration they need to realise another long-held dream, and that’s of becoming their own boss, working for themselves and starting their own business.

However, starting a business in some nations is not necessarily as relatively straightforward as it is in the UK.  So, if you’re planning to set up a business in the Netherlands as an expat for example, this article will guide you, step-by-step, on how the entire process works.

If you’re planning on starting a business in a foreign country, an already complex process can be compounded and made more difficult as you may not speak the native language, and you are not familiar with the rules and regulations that apply to sole traders or business partners for example.
Well the good news is that setting up a business in the Netherlands as an expat is relatively easy, and it can all be done and dusted in these 3 simple steps: -

Step 1: Decide which Dutch legal company form to use

Step 2: Incorporate your Dutch legal company form

Step 3: Register your business

Deciding which Dutch legal company form to use

In most cases one of the following two legal forms of company are used in the Netherlands to conduct business: - either a sole proprietorship (“eenmanszaak”); or
- a limited liability company (“besloten vennootschap” or “BV”).

Which one you should use depends on the type of business you are planning to set up.  In general a Dutch BV is used to limit one’s liability, when using a BV you will only be liable for the debts of the BV up to the amount of contributed capital.  If it is not necessary to limit one’s liability, then a sole proprietorship is often used as the tax treatment of such a company structure is slightly better.

The latter is however not the case when your profits are in excess of EUR 150-200k per annum, in that case it is better to use a BV.

Incorporating your Dutch legal form

Once you have decided between a sole proprietorship and a BV, you should incorporate the respective legal form.  For a sole proprietorship there is no incorporation procedure, you can actually conduct your business immediately just like in the UK.

As a Dutch BV is a separate legal entity however, it is incorporated via the execution of a ‘notarial deed.’  Thus, for the incorporation of a BV a Dutch notary is needed.  The notary incorporation fees of a Dutch BV start at around EUR 1k.  The minimal amount of capital you have to contribute to the BV at incorporation is EUR 18k.

Registering your business

After you have incorporated your business, you should register it.  Both a sole proprietorship and a BV need to be registered with the Dutch Chamber of Commerce and the Dutch tax authorities.  These registrations are done by filling in certain registration forms, and the registration with the Dutch tax authorities is an important one, as on the basis thereof it is determined which Dutch taxes you will be liable to.

After you have taken care of the registration requirements, you can start doing business in the Netherlands!

But before we conclude, you need to know that once your business is set up there are a few ongoing running requirements that you need to deal with.  First of all you should keep a proper record of your accounts and keep on top of company administration.  You can do this yourself or have an administration office take care of this for you.  Next thing that you should take care of is that your tax returns are properly and timely filed – and because Dutch taxation is quite complex, particularly where expatriates are concerned, you may well choose to have a Dutch tax consultant assist you with this – note, you need a tax consultant in the Netherlands, not an accountant like in the UK.

What’s more, you need to prepare a balance sheet and a profit & loss account for your business annually, and if you’re using a Dutch company structure then these annual accounts should also be filed with the Dutch Chamber of Commerce.

If you have any further questions or you need more information about starting a business in the Netherlands, then we recommend you contact Balthazar Tax Consulting who are specialist and expert Netherlands Tax Consultants, they can correctly assist you.