Netherlands

VAT Basics

Dutch VAT Rates

The Netherlands has opted for the reduced on a number of items allowed by the VAT Directive. Super-reduced rates do not apply in The Netherlands (source: European Commission).

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Netherlands Vat Tax

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Deduction limits in The Netherlands

Input VAT is generally deductible as long as the goods or services are used for business purposes. Where business expenses are used for both, business and private use, VAT is not deductible when the value of the private use exceeds €227 per year. This limit applies to the net value of the total expenses per employee per year.

In addition, the below list provides detail on deduction rules for each type of expense:

• Input VAT on hotel accommodation is deductible when it is used for business purposes.
• Input VAT on conferences, fairs and exhibitions is 100% deductible provided the expense is incurred for business purposes by employees of the company (restaurant meals are excluded)
• Business gifts are 100% deductible provided the €227 limit is not exceeded.
• Car rental, car repair and fuel expenses are 100% deductible. On car rental, the authorities often allow only an 84% deduction. The taxpayer must prove that the expense is wholly and entirely used for business purposes in order to deduct 100% of VAT.
• Taxi, train and other transport expenses is 100% deductible provided the expense is incurred for business purposes.
• Entertainment client expenses are 100% deductible provided the €227 limit is not exceeded.
• VAT charged over food and drink in catering establishments can never be deducted.

A valid and fully compliant VAT invoice must be issued for each expense on which VAT is deducted.

Deducting VAT prior to the beginning of the economic activity is generally allowed provided the taxpayer can prove that the costs incurred where fully used for business purposes. These costs would be deducted in the first VAT return following the VAT registration.

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Dutch statute of limitations

Input VAT should be claimed in a VAT return filed no later than the end of the fifth year after VAT became due.

The time limit on the obligation to pay VAT is also five years.

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Tax point rules in The Netherlands

The tax point is the time when VAT becomes due. VAT due should be distinguished from VAT payable. VAT is due when the tax point occurs. VAT is payable between the day after the end of the reporting period and the due date to submit and pay the VAT return.

• General rule: Tax point arises when the invoice is issued. Invoices must be issued at the latest by 15^th day of the month following the month in which the supply was made. In case the supply is made and the invoice is not issued, or issued late, then the tax point occurs at the latest on the date on which the invoice should have been issued, and in case of a B2C transaction, in the date of the supply.  
• Prepayments or advanced payments create a tax point because an invoice must be issued for each instalment or prepayment.
• Intra-Community acquisitions: Tax point occurs on the invoice date or the 15^th day of the month following the month in which the invoice was issued, whichever occurs earlier.
• Import: Tax point occurs when the goods are imported according to the relevant import documents. This date may be postponed if the postponed import VAT accounting applies.

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VAT registrations and simplications in the Netherlands

Vat Number in The Netherlands

As a general rule, a foreign business must register for VAT in The Netherlands as soon as a taxable supply is made. Registrations thresholds do not apply to non-established companies. The following are some usual examples of taxable transactions:

• Domestic supply of goods not reverse charged: A supply of goods located in the Netherlands where reverse charge does not apply requires a VAT registration of the supplier.
• Supply of services not reverse charged: Foreign non-established businesses supplying services on which Dutch VAT is due by the supplier must register for VAT. These services are rather exceptional, as the general B2B rule would apply.
• Export: Exporting goods to a non-EU country requires a VAT number before the export is made.
• Intra-Community acquisition: Acquiring goods from another Member State where all conditions for intra-Community movements are met requires the customer to register for VAT.
• Intra-Community supply: Supplying goods another Member State is also a taxable transaction that obliges the supplier to register for VAT.
• Distance sales: When applicable, in case the Seller has not joined OSS. See the E-commerce manual for more information.

Companies can also register voluntarily in The Netherlands. For example, if they are incurring Dutch VAT but not making any taxable transaction, it is possible to register for VAT and claim the VAT incurred via the VAT return instead of the 8^th or 13^th Directive.

The VAT registration threshold for established Dutch businesses is €20,000 of global turnover. Dutch companies below the threshold can benefit from a special scheme that simplifies their VAT compliance obligations. You may find more official information about this small business scheme . As mentioned above, this limit does not apply to non-established companies.

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Vat Number Format in The Netherlands

• Country code: NL
• Structure: NL999999999B99
• Format (excludes 2 letter alpha prefix): 1 block of 12 characters
• Comments: The 11th position is always by the prefix "B".

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Vat Fiscal Representative in The Netherlands

In general, EU and non-EU businesses do not need a fiscal representative when registering for VAT purposes in the Netherlands. Unlike other EU countries, EU and non-EU companies can register directly for VAT in the Netherlands. Registering directly means that the legal representative of the company can sign the registration form without any local Dutch involvement. Appointing a fiscal representative is however mandatory when applying for import simplifications such as Import VAT deferral, using VAT or customs warehouses or making certain zero-rated supplies.

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VAT groups in The Netherlands

VAT grouping is possible in the Netherlands. Normally, creating a VAT group is a voluntary choice made by the taxpayer (no mandatory VAT grouping). Only where the tax authorities have carried an audit and after reviewing the links between different members of the same group, they may determine that a VAT group is required. Regarding the eligibility criteria, the following conditions and information should be taken into account:

• Two or more taxable persons established in The Netherlands and having financial, economic and organizational links can create a VAT group.
• Financial links exist when more than 50% of the shares are owned directly or indirectly by another member. Organizational links require common management for all entities. Regarding the economic link test, it requires all group members to carry a similar activity or within the same industry.
• Holding companies are excluded unless they are involved in the management of the group.
• Non-established companies are also excluded. Branches and permanent establishments are accepted.

The application for a VAT group is submitted to the Dutch tax authorities, who will assess the request and make a decision. However, recent Court decisions have allowed for the VAT group simplifications to apply as soon as all conditions are met (no application would be required).

Some of the characteristics of Dutch VAT groups are the following:

• Upon registration, the VAT group will receive a VAT identification number which is separate from the VAT numbers of each member.
• All supplies within the VAT group are disregarded for VAT purposes.
• Normally, one single VAT return will be filed for the entire group, although exceptions can be requested.
• Finally, members of the VAT group are jointly and severally liable for VAT debts of the group.

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Dutch consignment and call-off stock

The EU introduced a call-off stock simplification that all EU Member States must implement. This was put into place so that businesses that operate under a consignment stock structure do not have to VAT register in the country of destination. The Netherlands has introduced the consignment stock simplification.

Check out our article on the EU call-off stock simplified VAT rules for more detailed information.

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Bad debt relief in The Netherlands

Bad debt regime applies on sales where an invoice has been issued with VAT, reported in the VAT return and the VAT amount has been paid to the tax authorities but the whole price has not been collected from the customer. This is often due to the client´s bankruptcy, insolvency or simple missed payments to suppliers. In these cases, most countries allow to recover the VAT initially paid to the authorities, however, the conditions change from one country to another.

The Netherlands has a flexible bad debt relief in comparison with other EU countries. Input VAT on bad debt can be recovered as soon as it is certain that the amount is irrecoverable, or when one year has been passed since the invoice was claimable. There are no additional formalities (eg no credit notes, corrective returns or letters to the authorities are not required). VAT on bad debt can be claimed directly in the VAT return of the period where the conditions have been met.

Find here more information about the Dutch bad debt relief.

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Import VAT deferral and postponed import VAT in The Netherlands

The Netherlands has introduced a postponed import VAT accounting mechanism where import VAT can be reported as input and output VAT (reverse charged) in the VAT return instead of being paid to the authorities upon importation. Import VAT deferral, meaning delaying the payment of VAT for a given period, is not applicable in the Netherlands. You should however be aware of the difference as postponed import VAT accounting is sometimes referred as deferral import VAT.

For postponed import VAT accounting to apply, a business must be established in the Netherlands or registered through a limited or general fiscal representative. Imports must be done on a regular basis and the applicant must keep records of all imported goods.

For more information on limited fiscal representation see section Global VAT numbers and limited fiscal represantive.

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Customs warehouse and VAT warehouse in The Netherlands

The Netherlands has introduced both VAT regimes, VAT warehouses and Customs warehouses. VAT warehouses apply specifically for goods that have cleared customs (T2 products). VAT is not due when these goods are traded under the VAT warehouse simplification. Only certain goods can benefit from the VAT warehouse regime, the tax authorities published a list every year with these goods, which normally include unfinished goods. These are products that need to be processed before being sold to the end consumer such as mineral products, agricultural commodities and certain chemical products. There are two kinds of VAT warehouses:

• Non-physical VAT warehouse (administrative VAT warehouse): This regime allows goods to be traded under the same conditions as within a VAT warehouse in any place within the Netherlands. Goods do not need to be located within the physical boundaries of a VAT warehouse, however, both supplier and client need to hold a VAT warehouse license.
• Physical VAT warehouse: As in other countries, VAT is not charged on goods bought and sold within a VAT warehouse. In this case, the supplier and the customer do not need to hold a VAT warehouse license, however, the goods must physically stay within the space limits of the VAT warehouse, which will be managed by a license owner. When the goods leave the VAT warehouse, the customer outside the warehouse accounts for VAT under the reverse charge mechanism.

Customs warehouses apply specifically for goods that have not cleared customs (T1 products). When goods from a third (non-EU) country are placed in a customs warehouse, no customs duties, tariffs or VAT is due. These taxes become due when the goods leave the Customs warehouse regime and the taxable person releasing the goods is the importer who is liable for VAT. In case the goods leave a customs warehouse but are immediately placed in another Customs warehouse, no import is made.

For more information about Customs in The Netherlands see the official website information.

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Global VAT numbers – Dutch limited fiscal representation

Global VAT numbers are known as Limited Fiscal Representation in the Netherlands. A limited fiscal representative can be used for imports followed by domestic supplies. In these cases, a VAT registration is not required, all transactions are accounted and reported by the limited fiscal representative under his own VAT number.

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Reverse charge in The Netherlands

Reverse charge for non-established suppliers – The Netherlands

According to art 194 of the VAT Directive, Member States may implement an optional reverse charge on supplies made by non-established businesses. The Netherlands has introduced this reverse charge on supplies of goods and services located in The Netherlands. Where a non-established supplier supplies goods or provides services located in the Netherlands to a VAT registered and established customer, domestic reverse charge applies. It is not relevant if the supplier is registered or not.

The domestic reverse charge on services is rather exceptional as it would only apply where the B2B rule on services does not apply. This is, for example, the case for supplies of services connected to immoveable property. The following wording should be stated on the invoice when domestic reverse charge by non-established suppliers applies: "btw verlegd / Reverse charge applies according to article 12, para 3 of Dutch VAT law".

Additionally, there is a specific reverse charge on supplies of goods made through distribution systems (gas, heat, electricity, etc.) by non-established suppliers to customers with a Dutch VAT number. This reverse charge is established in the article 12, para 2 of the Dutch VAT law.

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Reverse charge in B2B services in The Netherlands

Article 196 of the VAT Directive requires the reverse charge mechanism on all services subject to the B2B rule introduced in art. 44 of the same Directive. The B2B rule locates the transaction where the business customer is located. In case the customer is a private individual, B2C rules locate the transaction where the supplier is located. According to the general B2B rule, any business resident outside the Netherlands supplying services to a Dutch based customer will not charge any VAT and the transaction will be reverse charged by the customer. There are however a number of exceptions to this rule. Where these exceptions apply, reverse charge is still applicable in the Netherlands provided domestic reverse charge conditions are met:

• Services connected to immoveable property are located where the property is located.
• Passenger transport services will be located where the transport takes places (apportioned if necessary).
• Catering services are located where the catering takes place.
• Short term leasing of means of transport are located where the vehicle put at the disposal of the customer.
• Access to conferences, fairs and exhibitions is located where the event takes place.

The general rule may also be deviated where the supplier has a permanent establishment in the country of the customer and the PE has intervened in the supply.

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Dutch Reverse Charge on specific goods

Domestic reverse charge may also apply on certain goods and services in The Netherlands. The conditions and scope are different in each case. In some instances, this kind of reverse charge also applies when the supplier is established.

• Mobile phones, computer chips, IT equipment including laptops, tables and game consoles where the sale value exceeds EUR 10,000
• Construction work and ancillary services from a subcontractor to a contractor and from a contractor to a self-builder
• Supplies of goods released from a VAT warehouse
• Immoveable property (where opted to tax) irrespective of supplier and customer status
• CO2 Emissions
• Old used materials, scrap and waste irrespective of supplier and customer status
• Goods provided as security by one taxable person to another as part of a security
• Investment gold
• Telecommunication services (since June 2017).

Find here more information about reverse charge mechanism.

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Dutch use and enjoyment rules

When it comes to establishing the place of supply of a transaction, Member states may introduce another exception to the B2B rule according to the place where the services have been used and enjoyed. This exception may be introduced to avoid double taxation (positive use and enjoyment rules), to avoid non-taxation (negative use and enjoyment rules), or both.

The Netherlands introduced the positive use and enjoyment for certain B2C supplies of services, hence establishing the place of supply in the non-EU country where the customer is established. Some of the services included are supplies of staff and lawyer’s services.

The Netherlands also introduced the negative use and enjoyment rule, hence attracting the place of supply to The Netherlands. This concerns the previous services when provided by a Supplier established in a country outside the EU to bodies established in The Netherlands, provided that the services are used and enjoyed in this country.

Finally, the renting of means of transport B2C by a Supplier established outside the EU, when the customer is resident or established in The Netherlands the place of supply is attracted to The Netherlands when the services are effectively used and enjoyed in The Netherlands.

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VAT returns in The Netherlands

Frequency of Dutch VAT returns

As a general rule, VAT returns are filed quarterly in The Netherlands.  Monthly VAT returns can be requested by the taxpayer according to his individual circumstances (e.g. where the company is in a regular refund position). The authorities may also request a VAT registered company to start filing monthly VAT returns in case the VAT payments are made late on a regular basis. Annual VAT returns may be filed when the total amount of VAT due in a year does not exceed €1,883, the intra-Community supplies and acquisitions do not exceed €10,000 and the taxpayer has not applied for the postponed accounting of import VAT.

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Frequency of filing

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VAT return due dates in The Netherlands

The due of VAT returns in The Netherlands is different for resident and non-resident businesses.

Dutch and foreign established companies must submit and pay their VAT return by the last working day of the month following the reporting period. For example, the second quarter VAT return of 2022 of an established Dutch company must be paid and submitted by 29 July 2022.

Foreign VAT registered companies without a permanent establishment in the Netherlands must submit and pay their VAT returns by the last working day of the second month following the reporting period. For example, the second quarter VAT return of 2022 of a non-established company registered for VAT in the Netherlands must be filed by 31 August 2022.  Here is the tax calendar for foreign companies published by the tax authorities.

Annual VAT returns must be filed by the last working day of the third month following the reporting period.

More information about due dates for non-established companies is available in English in the website of the Dutch tax authorities.

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Dutch VAT payments

Non-established companies will often make payments from an overseas account. The details to be used for these payments are stated in the explanatory note attached the VAT return. The following details are used by some non-established taxpayers; however, you should double check the applicable IBAN account for your VAT payments:

• IBAN code: NL86 INGB 0002 4455 88
• SWIFT code: INGBNL2A
• Name of the bank: ING Bank
• Reference: The tax return number (aangiftenummer) or the payment reference stated in the form (betalingskenmerk) must be included as reference on your bank transfer.

Also, you can use this tool to generate the correspondent reference number for your payment due to the Dutch tax administration.

Established and resident companies must use different payment details.

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Dutch VAT refunds

VAT refunds are repaid automatically by the tax authorities once a VAT return is submitted in a repayable position.

Refunds are made into foreign bank accounts; however, the authorities must have your IBAN details. Normally, in your first VAT repayment, they will send you a letter asking you to complete a number of details in the form attached and send the form back to them. This step should only be made once. We suggest following up with the authorities once the form is sent back, as we have experienced delays in the past processing this information.

Businesses may also request the VAT credit to be carried forward and compensated against future VAT payments. In this case, a written request should be sent to the Dutch Tax authorities. In some instances, the authorities may carry an audit before repaying your VAT refund. These audits often request copies of invoices, VAT ledgers and a short description of the business.

You can double check the status of your repayments using your payment reference through the following link.

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Dutch nil and corrective VAT returns

A nil VAT return needs to be submitted even if there are no transactions to be reported for that period.

Regarding VAT corrections, where the total additional input VAT or output VAT in a correction does not exceed €1,000 the adjustment can be made in the following VAT return. However, in all other cases, a corrective VAT return must be filed electronically using the form "suppletie omzetbelasting". Where the correction is made within the three following months after the return submission, interest is not charged on the late payment. You will find more information about corrective VAT returns under the following link.

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Dutch Tax Authorities contact

The Netherlands has a dedicated tax office for non-established companies directly registered. All VAT registrations for these types of businesses, as well as other VAT matters, are handled by the Department of international issues of the Limburg tax office.

Belastingdienst/ Limburg/Kantoor Buitenland Postbus 2865 ~ 6401 DJ Heerlen The Netherlands Tel.: +31 555 385 385 (from abroad)

Further details are available in the website of the tax authorities. Established companies and companies registered via a fiscal representative are allocated a tax office depending on the location of their establishment or fiscal representative.

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Dutch distance sales. VAT on e-commerce

You can find information about the general EU VAT regime on distance sales in our manual about VAT on e-commerce. You may also watch our webinar explaining VAT rules for e-commerce in the European Union.

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VAT penalties in The Netherlands

If an intra-Community acquisition or any other purchase under the reverse charge mechanism is missed, the Dutch authorities will normally not apply any penalty. Additional penalties may be charged by the authorities, particularly in case of fraud. For penalties on ECSL, Intrastat and other returns, please see the relevant section.

Find here additional information about VAT penalties in The Netherlands.

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Dutch ESL returns. ESL and IPC Declaration

Due date and frequency of Dutch ESL returns

The frequency of filing depends on whether you make IC-supplies of goods or IC-supplies of services. Monthly ESL are due when the value of IC-supplies of goods exceeds €50,000 in the current or any of the previous quarters. If you are only supplying IC-services, you will file your ESL on a quarterly basis.

ESL returns may also be filed on an annual basis. In order to file ESL returns annually, companies must submit an application to the Dutch tax authorities and meet all relevant requirements. These requirements are available in the website of the Dutch tax authorities.

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Frequency of filing rules

More information about the frequency of filing ESL returns is available in English at the tax authorities’ website. The acquisitions are not taken into account when calculating the thresholds for the frequency of filing Dutch ESL returns.

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Dutch nil and corrective ESL returns

If there are no intra-Community transactions to be reported in a given period, a nil ESL is NOT due.

Corrective ESL returns

Corrective ESL returns in the Netherlands are prepared and submitted electronically by ticking the option 2 in the form. The corrective return is completed differently depending on the type of content corrected.  If the value is being corrected, you only add the full details of the line initially reported and a + or a – in the value field to bring the amount to the correct value. If the VAT number or name needs to be corrected, you enter the full details initially reported and then a – in the value box to bring the amount down to 0. Then you add a new line with the correct VAT number and amount.

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Penalties for late Dutch ESL returns

In case a company does not file an ESL return in the Netherlands, the penalty will depend on the number of times the return has been submitted late in the previous two years. The first time the return is filed late, a fixed penalty of €132 is charged. The second and third time that the ESL is filed late, €264 penalty applies, and the fourth and following times, a penalty of €1,320 will be assessed. The maximum penalty imposed may be up to EUR 5,278 in cases of absolute lack of submission or fraud.

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Intrastat returns in The Netherlands

Frequency and deadline of Dutch Intrastat

Like in most EU countries, Dutch Intrastat returns are filed monthly. They follow the calendar month. The due date to file these returns is the 10^th working day of the following month.

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Intrastat thresholds in The Netherlands

The Netherlands removed the Intrastat thresholds in 2023. Instead, similarly to France, they will notify the taxpayers that are subject to the submission of the Intrastat returns. In order to determine if a company must start submitting Intrastat returns, The CBS will monitor on a monthly basis the amounts of intra-Community transactions performed by the Dutch taxpayers based on their VAT returns.

There is no separate threshold for Detailed Intrastat returns in the Netherlands. Once filed, a complete calendar year needs to be covered by a company in order to stop filing these returns. For example, if a company exceeds the threshold in March 2024 on arrivals, Intrastat returns for arrivals are due until December 2025. The authorities monitor the thresholds and often send letters to each taxpayer requiring them to file missing Intrastat returns.

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Specific Dutch Intrastat scenarios

Very often, the transactions reported in the Intrastat return are standard sales from one taxable person to another. However, a number of scenarios have specific reporting requirements. The nature of transaction code in the Netherlands have been recently updated and have now two digits. See the official Intrastat manual under the following link. It contains the nature of transaction for the reporting of specific scenarios:

• Returns of goods must be reported under Nature of transaction 21. This applies to both flows, Arrivals and Dispatches.
• Transfer of own goods is reported under Nature of transaction 11.
• Credit notes are reflected in the Intrastat return with a minus in the value.

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Dutch nil and corrective Intrastat returns

If no transactions are to be reported, a nil Intrastat return must be filed. Regarding corrections, if an Intrastat return has been submitted showing wrong or incomplete information, a new return needs to be submitted electronically correcting the wrong data and adding the data initially missed.