VAT Guide for Freelancers in Netherlands

The Netherland's VAT policy is based on the "destination principle" of the European Union VAT system. This means that VAT, or belasting toegevoegde waarde in Dutch, is payable to the country's government where the product or services are consumed, regardless of where you're supplying them from.

If you have clients in the Netherlands, you have to comply with Dutch VAT rules. VAT is administered by the Tax and Customs Administration (Belastingdienst Nederland), the tax collection and customs service of the government of the Netherlands.

The standard VAT rate in the Netherlands is 21%, with reduced rates of 9% and 0% applied based on the products you sell. This guide includes everything you, as a freelancer, need to know about VAT in the Netherlands in a nutshell. Let's get started!

What is the VAT rate in the Netherlands?

The Dutch government levies three different VAT rates, and freelancers must charge the amount that applies to their products and services.

  • The Standard Rate - Unless the items or services you offer are in the reduced rate or zero-rated category, you should charge the standard VAT rate of 21%.
  • The Reduced Rate - The reduced rate of 9% applies to items such as some food and soft drinks, water supplies, certain pharmaceutical products and medical equipment for disabled persons, newspapers and periodicals, admission to cultural events and amusement parks, certain renovation and repair of private dwellings, certain cleaning of private households, hotel accommodation, restaurants (excluding alcoholic beverages), admission to sports events, use of sports facilities, shoes and leather goods, clothing and household linen, cut flowers and plants for decorative use and food production, some works of art, collector's items and antiques, and so on.
  • The Zero Rate - When items are zero-rated, they are still VAT-taxable, but the rate of VAT you must charge your consumers is 0%. This rate applies to the taxation of gold coins, intra-community and international passenger transport by air and sea, and so on. Although there are no charges on zero rates, you should record sales of goods and services and create a report based on your returns.

 

It is mandatory to charge VAT when invoicing your clients in the Netherlands. There are, however, some exceptions: if you teach educational courses or provide educational training, work in medical services and products, etc. You can find an extensive list of exempted professions, goods, and services here (in Dutch).

When to register for VAT in the Netherlands?

There is no threshold for VAT registration for freelancers in the Netherlands. Therefore, as long as you have customers and business activity in the country, you are liable to charge VAT. 

Non-residents of the Netherlands can trade in the country without establishing a local company there. However, individuals registered in the EU and distance-selling goods to the Netherlands do have a registration threshold of €100,000. Once their annual turnover exceeds this amount, they must register for VAT.

You can click here for more information on when to register for VAT in the Netherlands. 

How to register for VAT in the Netherlands?

To register for VAT, you must first register your freelance activity with The Kamer van Koophandel (KvK), the Dutch Chamber of Commerce. The Trade Register of the Commercial Chamber will then transfer your information to the tax authorities to register for VAT. The process takes around five days, and you will then receive your VAT number. You are liable to pay VAT to the government starting from the date you register.

Expat freelancers supplying goods or services in the Netherlands must also register with the Dutch Chamber of Commerce.

You can also register using the Mini One-Stop-Shop, an EU-wide tax system that allows you to consolidate all of your EU VAT in one single tax return. This scheme is optional but convenient and especially useful if you have customers in multiple countries within the EU, including the Netherlands. MOSS allows you to avoid registering in each Member State of consumption. To learn more, click here.

Lastly, you can hire an accountant (or agency) to handle your VAT returns and dealings with the Dutch Tax Administration. Xolo provides services like Xolo Go and Xolo Leap, which help with precisely this and any other VAT concerns you may have.

Financial obligations of VAT registered freelancers in the Netherlands

Registering for VAT is only part of the process; in order to to be fully VAT compliant, you must:

  • Charge the correct VAT rate
  • Pay any VAT owed to the tax office
  • File VAT returns
  • Maintain VAT invoices and a VAT account

VAT invoices are the official record of how much tax you charge and collect, and therefore the official proof of how much tax you owe the government. You must make sure to include the following in your Netherlands VAT invoices:

  • Your business name and address
  • Your business VAT number
  • Invoice date
  • Invoice sequencing number
  • Description of the goods or services
  • Rate of VAT applied to each item
  • Total amount including VAT

The invoices must be issued within six months of delivering your product or service. You must then store these invoices electronically for ten years. Does that sound overwhelming? We've got you! Xolo automatically generates, sends, and stores all your invoices digitally, so you won't have to worry about misplacing them over the next decade.

How Xolo Can Help?

Why submit your tax reports with help from certified tax consultants? Learning all the Dutch tax guidelines can be challenging, especially if you're a sole proprietor and in charge of several aspects of your business. Luckily, at Xolo, we offer a range of solutions that can handle all the paperwork and legal jargon, allowing you to focus on your core competencies.

Xolo Leap is the easiest and most effective way to create your own company through Estonian e-Residency! Reduce time spent on mundane business administration and focus on what you do best!

  • We offer different tiers of service depending on the solopreneur's (or as we call them, Xolopreneur's) individual needs.
  • Once you get your business set up with Xolo Leap, you can literally run it from anywhere in the world! So whether you're a freelancer looking to gain access to the EU market or a digital nomad who can't be tied down - this is the place for you! 

Xolo Go is a quick and efficient way for freelancers who don't have a registered LLC or sole proprietorship to invoice clients legally. 

  • Signing up takes only 10 minutes, and once you do, taxation, corporate compliance, and all the tricky VAT calculations are all automatically taken care of in the background!
  • We charge a flat rate of 5% from every withdrawal to your personal bank account. No surprise fees, no contracts, and no BS.

So connect with us immediately, and we'll help you get your one-person business up and running in the Netherlands in no time!