VAT
Overview
Overview of VAT in The Netherlands
If you set up a business in The Netherlands, it’s important to consider the VAT (Value Added Tax) requirements and to understand how VAT works in The Netherlands.
Companies conducting business with or from the Netherlands are in most cases liable for Dutch VAT. When a company is liable for Dutch VAT they will have to obtain a VAT number (please see our article how to obtain a Duch VAT number). Once your company has obtained a VAT number, or started it’s business in The Netherlands, it should consider the following VAT requirements::
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Keeping a proper account and records. These must be kept available for at least 7 years;
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Issue and process credit notes and other corrections when applicable;
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Applying the correct VAT rates;
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Filing ICP returns, covering you intra EU-community transactions;
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etc.
VAT tariffs in the Netherlands
In the Netherlands there are 3 VAT rates applicable:
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0% rate
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9% rate
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21% rate
0% rate
The 0 percent rate is applicable to entrepreneurs conducting business from the Netherlands to foreign countries. For example:
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The supply of goods from the Netherlands to another EU country;
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Services provided within the Netherlands, for example, services related with cross-border transactions;
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International transport of passengers.
More information about the 0% rate can be found on https://www.belastingdienst.nl/wps/wcm/connect/bldcontenten/belastingdienst/business/vat/vat_in_the_netherlands/vat_relating_to_purchase_and_sale_of_goods/export_from_the_netherlands_to_other_eu_countries_intra-community_supply/export_from_the_netherlands_to_other_eu_countries_intra-community_supply and on https://www.belastingdienst.nl/wps/wcm/connect/bldcontenten/belastingdienst/business/vat/vat_in_the_netherlands/vat_relating_to_purchase_and_sale_of_goods/export_from_the_netherlands_to_non-eu_countries
Please note that when the 0% rate is applicable you can still deduct VAT. When a company is VAT exempt this company cannot deduct VAT.
9% rate
As from the first of January 2019 the low rate of 6% is increased to 9%. The 9% rate is applicable on basic necessities of life, such as:
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food
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drinks
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agricultural products and services
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medicines
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books
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etc
At the following website: https://www.belastingdienst.nl/wps/wcm/connect/bldcontentnl/belastingdienst/zakelijk/btw/tarieven_en_vrijstellingen/tarieven_en_vrijstellingen you can find an extensive overview of the type of goods and services to which the 9% rate is applicable. This list is only available in Dutch.
21% rate
When the 0% or 9% rate are not applicable then you must charge the standard VAT rate of 21%.
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