Which fees are not included in INCO’s standard Company Package?
Any courier charges: If we need to courier the documents to you, we will charge the actual courier charges plus a 15% handling fee.
Legalization fees: We will deliver the original company documents, however if you need an extra legalized set, or an apostille on the documents extra fees will be applicable. For the Dutch bank this is not required
The annual payment to the Dutch Chamber of Commerce (Kamer van Koophandel): You will receive the first invoice approx. 1 week after registration of the company. The fee is € 50 per year.
Banking fees: At the moment, no bank account opening fees are charged by the bank, but they will charge the company about 10-25 euro per month to maintain the account, depending on the type of account. Fees might vary per bank.
What methods of payment does INCO accept?
We accept direct bank transfers, cash or PayPal.
How will INCO help me start my business legally?
INCO Business Group has developed a broad network of lawyers, accountants and other corporate service professionals. Together we leverage each other’s specialties to grow (y)our business.
How much time does it take to set up a company in the Netherlands
It takes 2 to 4 working days to set up a company in the Netherlands, depending on the type of legal entity you choose. For some steps in the process, we are depending on other legal authorities such as the Chamber of Commerce, the notary and the Dutch Tax Authority. This means we are also depending on how fast certain documents are provided to us.
Do I have to pay share capital anywhere in the formation process?
Yes, you need to share capital in case it is over €100. When less than €100, the notary typically assumes that the company has sufficient funds. However, some notaries expect you to pay €1, by handing it over during the meeting. In order to pay the share capital it is required to transfer the funds to the bank account of the company(or the notary’s bank account), using the payment description ‘Capital Deposit’.
What are the procedures and requirements of setting up a company in the Netherlands?
There are a lot of potential issues you will have to take into account when setting up a company in the Netherlands. Which legal entity best suits your needs, registration with the Chamber of Commerce (KvK) & the Dutch tax authority, residency permits, environmental regulations, selecting a company/trade name, registering employees are some of the examples that could prove rather difficult. In a lot of instances you will need to deliver several legal documents and explain your intended entrepreneurial activities. With the help of INCO Business Group, all of these potential issues will be taken care of, as we deal with these on a daily basis. The exact procedure could differ in each situation, and we will guide you through it at the best of our abilities.
What are the steps I have to follow as a foreign investor/entrepreneur?
To begin incorporation of your company in the Netherlands we will require the following things:
Your company name
The full name, date of birth, address and nationality of all directors
The full name and address of all shareholders
The company’s proposed business activities
How do I initiate the formation process?
In order to proceed please contact us, so we can discuss your personal situation in our Start-Up Consult. After this call you will receive an order form, after which we can start the invoice process, which is followed by the incorporation process.
What kind of bank card will we receive when opening a bank account in the Netherlands?
You will receive a Dutch debit card provided by Maestro. You can also apply for a credit card, like MasterCard or American Express. However in some cases, a credit history is required. We can also apply for a prepaid credit card (Visa or MasterCard), and connect it to the company’s bank account.
What is “remote formation”?
“Remote formation” is the act of incorporating a company in a country without visitation. For example, an entrepreneur from Poland wants to incorporate a Dutch BV in the Netherlands, but does not have the time to come to the Netherlands. In this case, an INCO Business Group employee can sign the legal documents with the help of a Power of Attorney.
What is the procedure of setting up a Dutch company?
The exact procedure of the incorporation could differ regarding the corporate entity and urgency of the request. However, there is a standard procedure which can be roughly followed. Firstly, INCO will require the following documents and information to begin the process:
- Passport copy of the chosen director or shareholder(s)
- Proof of address (e.g. utility bill) of the director and shareholder
- Complete order form
- Invoice details (name and address)
In the event that the chosen shareholder is a legal entity, we will require:
Legalized Certificate of Good standing, or;
An extract from the Companies Registrar which identifies the neutral person who is authorized to sign the Memorandum of Association of the new Dutch BV
Once we have received these, we will send you the following documents:
- Draft statutes
- Personal data card
- Power of Attorney
If you are not visiting INCO at one of our offices, these documents need to be printed and signed at the public notary. You will then need to send us scanned copies for approval. As soon as we have approved these, we will need you to send us the originals by courier.
On receipt of the original signed documents, we will begin incorporation of your Dutch company and register it at the Chamber of Commerce in the Netherlands.
Upon successful incorporation, which will take a few days, INCO will send you scans of the company documents and an extract with your company’s registration number. With your registration number you will be able to apply for a Dutch business bank account.
Before you decide to use the BV, which is the most common private limited company within the Netherlands, INCO could also help you consider other legal entities. The Dutch Partnership or Dutch Foundation being two examples.
What does INCO’s accountancy services include?
Regarding our accountancy services we charge a fixed fee of €105 EUR per month (ex VAT), which is charged every quarter. This fee is a fixed and generic which we use for new startup companies, since it can take up 6 to 12 months before the company becomes really active. We expect that startup or holding companies will not have more than 10 incoming and/or outgoing transactions per month that we need to process. So as long as your company is in the startup phase, and does not exceed these volumes, then the fixed fee will stay applicable. Once it becomes clear that the company has become truly operational and will have more than 10-15 invoices per month, we need to discuss a new quote for our services. INCO will act flexible in this matter, and if you end up with 12 invoices per month, or perhaps even 20, we will not suddenly increase our fees. All will be done in mutual agreement, once it becomes clear that your structural situation has changed.
Our fees include the following services:
Preparation and filing of first VAT Questionnaire from the Dutch Tax Authorities (bear in mind, we will need your input in this)
Preparation and filing of 4 VAT Returns (full book year)
Preparation and filing of the Annual Report (Abbreviated Accounts)
Filing of the Corporate Tax Return
Processing all invoices, transactions, etc. in our Accounting Software (no online shared account available, but reports can be shared)
In case you expect a large and/or complex administration, or if you have specific requirements, we prefer to include one of our associated accounting firms in this. This will also be the case in case you request for a (voluntary) audit.
Can I use a European company as re-invoicing/importing company?
Yes. The best way to do this is to incorporate a company in the country where you invoice most of your clients. The best entity usually is a Private Limited. We suggest that put more effort into creating more ‘substance’ in the Netherlands, if you use a Dutch company solely to import goods and deliver the goods in the rest of Europe (except for the Netherlands). You can create more substance with f.e. opening your own warehouse in Netherlands, or employing agents or staff members.
What licenses do I need to obtain in order to operate legally in the Netherlands?
You need a regular business license, which will be valid for most business activities in the Netherlands. The business license will be provided by the Chamber of Commerce within 1 day after the company formation.
Does the registration at the Chamber of Commerce imply any costs?
Yes. The Dutch Chamber of Commerce will charge a one-time fee of €50.
Am I limited in doing business within Dutch borders if I start a business in the Netherlands?
No, a Dutch company is not limited to trade in the Netherlands. Almost every Dutch corporate entity is allowed to participate in international trade. There are no huge trade barriers that would impede any corporate activity that fall within EU legislation. However, products like weapons, drugs, alcohol, tobacco need special import/export licenses.
If I want to transfer my overseas investment funds in the Dutch bank for my Dutch company as initial capital, could it be subjected to taxation in the Netherlands?
There will not be any taxation applicable, unless you become a resident of the Netherlands. In which case you would have to pay the capital gains tax of 1.2% per year.
Can we imply different ways of payment with our Dutch business account?
Yes, you can register all kinds of payment methods. Your bank might charge you extra for different methods of payment.
Are there any restrictions on trading activities?
Yes, specified type of activities, which include for example, banking, insurance, financial services, consumer credit related services and employment agencies. There is no separate business license required for standard trading and consultancy activities.
What’s the language of Legislation and Corporate Documents?
Dutch. English language (or other languages) can be included (with apostille).
What are the Name Restrictions?
A name that is similar or identical to an existing company.
A well-known name that is known to exist elsewhere.
A name that implies illegal activities.
A name, which in the opinion of the Registrar is considered undesirable, obscene or offensive.
A name that implies royal or government patronage.
What language can the Company Name be?
The name of the company can be expressed in any language using the Latin alphabet. The Registrar may request a Dutch or English translation to ensure that the proposed name does not contravene name restrictions.
Which names require consent or a licence?
Bank, building society, savings, loans, insurance, assurance, reinsurance, fund management, investment fund, trust, trustees, Chamber of Commerce, cooperation, council, municipal or their foreign language equivalents or any name in English or a foreign language that may suggest association with the banking or insurance industries.
Will there be any disclosure of Beneficial Ownership to authorities?
To open a bank account, it is required for the director of the company to visit the bank in The Netherlands. The bank account will be opened during the visit and one of our colleagues will join the director to the bank.
What is a Power of Attorney (POA)?
A power of attorney (POA) is a written authorization to represent or act on another’s behalf in private affairs, business, or some other legal matter. The person authorizing the other to act is named the principal, grantor, or donor (of the power).
In practice it’s common to provide the Notary Public a ‘Poa’ (or proxy) to incorporate the company on the shareholders’ behalf.
What is a STAK?
A STAK (Stichting Administratiekantoor) is a form of legal business structure. It is a different version of the Dutch Foundation. It is a foundation that owns one or more Dutch B.V.’s (private limited). This sounds contradicting because a Dutch Foundation may not make any profit (not more than €15.000 EUR annually). However, the STAK is only the owner of the legal rights of the shares. This means that the STAK has voting- and/or board rights within the B.V., but do not have any economic rights. These economic rights are handed out in the form of profit receipts. The STAK is the owner of these shares, but does not have any economic interest.
What are royalties?
A royalty is a payment to an owner for the use of property. In particular, patent copyrighted work, franchises or natural resources. A royalty payment is made to the legal owner of the property, patent, copyrighted work or franchise by those who wish to make use of it for the purposes of generating revenue or other desirable activities. In most cases, royalties are designed to compensate the owner for the asset’s used. And they are legally binding.
What is an UBO?
UBO stands for Ultimate Beneficial Owner and is appointed by companies to prevent from money laundering and financially supporting terrorism. A beneficial owner refers to the natural person(s) who ultimately owns or controls a customer and/or the natural person on whose behalf a transaction is being conducted. Moreover, it includes those persons who exercise ultimate effective control over a legal person or arrangement.
The Dutch BV
What is a Dutch B.V. (Besloten Vennootschap)?
A Dutch B.V. can be compared to a Private Limited Company. Some characteristics of the Dutch B.V. are:
A Dutch B.V. has a legal personality with a share capital divided into a minimum of one share. The shares (along with voting rights) must be issued to an individual or a legal personality (private limited company).
It is possible to appoint a single, non-resident individual or corporate entity as the director or shareholder, making the Dutch B.V. a very flexible entity.
The shares of a Dutch B.V. are usually not freely transferable due to transfer restrictions by law or restrictions set out in the articles of association.
Shareholders of a Dutch B.V. are not personally liable for losses of the company in excess of the amount which must be paid into shares.
What is the minimum amount of required share capital to set up a Dutch B.V.?
Since 2012, the minimum amount of share capital is €0,01 EUR.
Can a director be an employee of the Dutch B.V. and the main shareholder at the same time?
Yes, according to Dutch corporate law there are no direct restrictions.
Can a Dutch B.V. have shares without having profit- or voting rights?
Yes, there is a possibility to divide these rights. However, a share has either a profit or a voting right. The division of these rights could be structured via a STAK (Stichting Administratiekantoor). This kind of legal structure is an alternative to the Dutch Foundation. In essence, the STAK is a Dutch Foundation (Stichting) that owns one or more Dutch BV’s, of which the shares are ‘swapped’ for non-voting profit certificate (also called depository receipts).
The STAK is a legal entity typically used for ‘holding purposes’ rather then for operational purposes, to create an extra layer of protection between the company ‘owner’ and the investors who are entitled to a (part) of the profit. Several Dutch listed (stock exchange) companies have applied this corporate structure.
The STAK, as the shareholder, has full power of it’s operational company (subsidiary), but does not have any economic rights. These economic rights are handed out in the form of profit receipts, to investors and shareholders. The main advantage of this setup, is that the entrepreneur can act as Chairman in the STAK, maintaining full control, not having to worry about the power of the investors and shareholders.
The legal rights can be difficult to trade, but the economic rights of the shares can easily be traded without the involvement of a notary. This kind of flexibility will reduce costs and enables the investors to protect their privacy.
Can a STAK only be used for Dutch B.V.’s or could it also be used for foreign private limited companies?
The Dutch Foundation can be used for any foreign private limited company with shares as long as it fits within the (Dutch legal) requirements of the STAK.
How can I liquidate my limited liability company?
In order to liquidate your Ltd. you will need to follow the following steps:
All shareholders need to decide to liquidate
Appointing the liquidator
Notifying the court that the liquidation process has started
Dividing left-over money
Final declaration which states that all money and debts have been divided
Sending a letter to court to delete the company from the register
Can we set up a branch office in the Netherlands that would disregard the need to establish a Dutch BV?
Yes it is possible to set up a branch. However, Dutch authorities (banks, tax office, chamber of commerce) prefer to work with local legal entities. If you register a branch it is still a foreign entity, which means you could face difficulties when opening a bank account or obtaining a VAT number. Therefore, we would advise you to set up a subsidiary or separate BV.
What are the advantages of a Dutch B.V.?
The Dutch B.V. is the legal entity that is used most often in the Netherlands.
The BV can be considered a ‘Private Limited Company’ which allows the shareholder to easily structure hi new business, while being able to involve investors, other shareholders, and protect his company (from undesired takeovers).
Compared to the ‘Public Company’ the BV is fairly cheap to set up and the shareholders have limited liability, meaning that if the company would go bankrupt, the shareholders are not liable for their personal assets and could only lose their investments in the Dutch B.V.
The Dutch Foundation
What is the minimum amount of members/ chairpersons required for the registration of a Foundation?
The minimum amount of members or chairpersons required is one. There are three ‘titles’ namely the chairman, secretary and treasurer that have to be appointed. However, one person can hold all three titles.
Can I be part (member or chairperson) of two different Dutch foundations?
Yes. There are no limitations to be part of two different Dutch foundations according to Dutch corporate law.
What is a Dutch foundation?
A Dutch Foundation (Stichting) is a corporate entity with limited liability, but unlike a Private Limited, it has no shareholders nor share capital.
Not having any shareholders means it offers a degree of anonymity to the ultimate beneficial owners (UBO) of the entity. This means that any party involved in the foundation, apart from the foundation’s board of directors, remain undisclosed. Note: the source of funds and any underlying parties involved will need to be disclosed to the Dutch agent.
Dutch case law has established that a Dutch Foundation will not be subject to corporate income tax/VAT in situations where they are considered to be solely a holding foundation.
The foundation cannot make profits over €15.000 EUR per year.
The self-owning and tax free characteristics of the Foundation can make this legal entity also interesting for funding, re-invoicing purposes or even ICO/blockchain concepts. For example, in case you need a Dutch legal entity for a practicality (to open a local bank account or merchant account, or because you require a Chamber of Commerce number), it can be a low-maintenance solution.
Profit receipts can be issued to investors or shareholders, which allows them to take profits, but without getting any voting rights. In effect, the legal ownership is separated from the economic ownership. As it is considered a ‘legal person’, a foundation can be used as the top entity in a group structure and be recognized as the UBO of the structure.
What are the advantages of a Dutch foundation?
The Foundation is a self-owning entity (until it decides to issue profit certificates), so the owners are fully protected, and in most cases do not even have to be disclosed (in their local tax return, etc.). Some characteristics and/or advantages of the Foundation are:
Profit receipts can be issued to investors or shareholders, which allows them to take profits, but without getting any voting rights. In effect, the legal ownership is separated from the economic ownership. Multinationals prefer this setup, in order to prevent hostile takeovers, and put more power at the level of the board of directors. For tax purposes, profit certificate holders are typically treated equally as shareholders. It is not required to issue profit certificates at formation; this can be done later. Please note that only profit certificates can be issued if there is also a Dutch B.V. as a subsidiary of the foundation. In effect, the foundation will be the legal owner, while it ‘transfers’ the economic ownership by issuing profits certificates. We call this setup the ‘STAK’ (Stichting Administratiekantoor).
It does not require tax registration in the Netherlands if it is only involved in passive investments owning real estate, stocks, shares, etc.
The foundation requires only one director, which can be a non-resident corporate entity.
It can voluntarily register for taxes, when it becomes ‘operational’. Even if it becomes operational, it’s not required to register for taxes (or pay taxes) as long at the profits do not exceed €15.000 EUR per year.
It has no formal UBO’s, so when opening a bank account in Netherlands, no UBO’s have to be declared (unless profit certificates have been issued, in that case the holders will be considered UBO’s if they hold more than 25% of the capital).
The foundation is considered to be an ideal option as a ‘conduit company’, for re-invoicing (royalties, import, export etc.) Since it will not generate any profits in that case, it does not require any tax registration (note: it will not be possible to utilize tax treaties as well).
In case of death, or similar events, there will be no taxable event, because the ‘next of kin’ will be appointed as new board members, but there will be no transition of assets (instantly).
In case of divorce, the assets of the foundation (owner) will be protected. In case profit receipts/certificates are issued, they are considered the same as ‘shares’ and are assets that can be seized.
Can funds from a foundation be transferred to low/middle income countries in the form of projects or grants?
Yes, there are no direct limitations for the transferal of funds. However, funds cannot be sent to ‘beneficial owners’ of the company, unless they have a certain right to these profits.
Can you add a non-resident director to the foundation and still have full foundation status?
Yes, you can appoint non-resident directors to the Foundation without any direct limitations.
Can a Dutch Foundation avoid tax filing requirements??
When the Foundation is registered as operational company at the tax authorities, it will have to comply with the standard tax filing requirements. Such tax registration is compulsory as soon as the Foundation makes more than €15.000 p.y. in revenue from operational activities. In case of passive income (owning real estate, stocks, shares, etc.), it can avoid tax consequences, but in some cases it might be advantageous to be tax registered/resident in order to apply tax treaties.
Can any Dutch company raise (tax-free) donations (as NGO)?
No, in this case it’s best to opt for the (not tax-registered) Dutch Foundation. However, if you collect donations from local residents, please note that without ANBI status for the Foundation, the residents are not able to claim the gift as a credit on their income tax return. However in any case, the income will be tax free for the Foundation. Obtaining The ANBI status is quite complicated, and small donations, typically do not meet the minimum gift-threshold of €60. So any donation below €60, will not be considered tax deductible.
The Dutch NV
What is the Dutch N.V.?
The Dutch N.V. (Public Limited) is similar to the Dutch B.V. (private limited), because the capital of the company is divided into shares and owned by shareholders. However, the company’s shares are not registered to certain owners, so that they may be traded on the public stock market. The phrase literally means “Nameless Partnership” or “Anonymous Venture”. This is in contrast to the Dutch B.V. Furthermore, the minimum start capital for the Dutch NV is €45.000. The shareholders are not personally liable for the liabilities of the firm.
Is it possible to make our directors/ shareholders anonymous to the public?
The Chamber of Commerce (KvK) in the Netherlands provides access to the full list of registered companies, which is open to the public. This means that it is possible to acquire some basic information about the company like the identity the director and (in some cases) shareholder. This information can be extracted by registering for an online account and by downloading an extract of the Company. The details of shareholders of Public Companies, like the Dutch NV, are not registered in ‘open’ registers.
What are the advantages of a Dutch N.V.
The main advantage of the Dutch NV is that it enables you to trade your shares freely, without restrictions
The Dutch Holding
Do I have to pay taxes if I incorporate a holding company in the Netherlands?
If a holding company doesn’t make any profits, it does not have to pay corporate tax. Regarding dividend tax, there will not be any tax on received dividends.
The Dutch Sole Trader
The Dutch Sole Trader
What is a Sole Trader?
The Sole Trader is a type of business entity that is owned and run by one natural person. In this entity there is no legal distinction between the owner and the business. The owner is in direct control of all elements and is legally accountable for the finances of the business (this may include debts, loans, loss, etc.)
What are the advantages of a Sole Trader?
Can I establish a Sole Trade Proprietorship as non-resident?
Yes, you can. There is no need to have a local residency permit, or nationality to establish a Sole Proprietorship. This also applies for non-EU citizens.