Establishing a Dutch BV
A Dutch BV is a limited liability company. With over 480,000 limited liability companies (BVs), it stands as the most important legal form in the Netherlands. Within this form, the company is recognized as a legal entity;
it can enter into contracts and obligations, but also can go bankrupt. This structure makes sure you are only limitedly liable as a legal entity. In addition to limited liability, profits from your BV are also taxed at a lower rate, making this legal form attractive to many entrepreneurs. Do you want to set up a limited liability company yourself? Then we are happy to inform and advise you.
Requirements for establishing a BV
We take care of everything for you when setting up a Dutch BV.
As there are several important steps to go through, proper guidance is crucial. This way, you will always know what to expect and what to consider. Generally, the following requirements are set for establishing a Dutch BV:
- Notarized certificate of incorporation with articles of association
- Initial capital and share capital
- Structuring roles within the BV
- Chamber of Commerce registration
- Post-establishment: annual financial statements and DGA salary
Would you like to establish a BV that meets all the requirements? Contact us, and we will handle the entire process for you.
The application
If you have a plan, we take care of implementation. When establishing a BV, several steps emerge in the initial phase, such as the first application. Before everything can be set in motion, you have likely already considered issuing shares to one or more future shareholders of the BV. Additionally, we are happy to inform and advise you on important aspects that arise when establishing a private limited company.
Want contact us if you want to know more about DGA salary, dividends from the BV, corporate tax, applying for fiscal numbers/VAT number, setting up and applying for a BV bank account, and liability/continuity?
What are the costs of setting up a Dutch BV?
When establishing a BV, there are several individual costs involved, such as visiting the notary, registration with the Chamber of Commerce, and the contribution of initial capital. Notably, visiting a notary for the incorporation of a BV can incur significant expenses. By choosing our full-service approach all the costs are combined and remained low.
The BV application will eventually be reviewed by the notary, who will check that everything is in order. A mandatory check of the identity of the directors and shareholders is part of this process. Subsequently, the deed of incorporation is executed by the notary. With the notary’s approval, the establishment of the BV is confirmed.
Seed Capital
With the enactment of the Flexwet in 2012, it is no longer mandatory to contribute start-up capital to a BV. Previously, there was a mandatory initial capital of 18,000 euros, but this is no longer required. Nowadays, you can establish the limited liability company already with a symbolic 0.01 euros. However, we do recommend bringing in some start-up capital, and the expected costs within the first quarter can be used as a guide in this. We are happy to inform you about the expected costs. This helps you determine a minimum start-up capital and limit the risks.
What do we do regarding the incorporation?
We support and advise you from the initial plan till the final incorporation of your BV. We understand that you prefer to focus on the core business of your company. That’s why we take care of setting up all components and details. Together, we ensure a strong foundation from which your BV can thrive.
Frequently Asked Questions
You can download a draft certificate of the incorporation of a bv from the link below.
This deed has already been adapted to the new Flex BV legislation that went into effect on October 1, 2012. You must provide your name and email address, and the deed in PDF format will be forwarded to you by email.
Download the deed of a limited liability company here.
Address BV Netherlands
A BV must provide a Dutch address for registration with the Chamber of Commerce in the Netherlands. This must be proven by a valid lease agreement, or by the BV being established at the home address of one of the BV’s directors.
In accordance with Article 177(3) of Book 2 of the Dutch Civil Code, the registered office of the BV must be located in the Netherlands. According to Article 180 Book 2 BW, the directors are required to register the BV with the Chamber of Commerce.
Thus, if a Dutch legal entity only has branches outside the Netherlands, registration with the Chamber of Commerce must also take place.
The details of the company abroad are not included in the Commercial Register. Please note that a BV always remains taxable in the Netherlands for corporate income tax, in accordance with Article 2 of the VPB Act. Thus, the BV continues to receive a tax return form from the Dutch tax authorities, even if there are no taxable events in the Netherlands. There are no taxable events in the Netherlands when all activities take place outside the Netherlands, or when the actual management of the BV is outside the Netherlands. The BV is then taxable where the activities are carried out, or where the board makes the actual decisions.
VAT number application
After the incorporation of the company, we apply for a VAT number for your BV.
When registering the BV with the Chamber of Commerce, you will receive an RSIN number. This number also appears on the extract from the Chamber of Commerce. This RSIN number becomes the BV’s tax number. The VAT number is a derivative of this number, namely with the addition NL and B01 at the end. However, this number must be activated, and we can perform this process for you.
To assess whether the BV is an entrepreneur for VAT purposes, the following are considered:
A taxable person for VAT is any person who, in the exercise of an economic activity, regularly and independently, with or without profit, makes supplies of goods or services , regardless of where the economic activity is carried out.
- Anyone:
Natural person, legal person or associations as far as they carry out economic activities - Economic activity:
This includes all activities of the producer, trader or service provider (except exempt operations). - Regularly exercised activity:
To be a taxpayer, the actions listed in the Code must be regularly performed by him/her. Only through succession do actions become an activity. The regular occurrence of the acts under form of an activity is not clearly delineated. Deciding whether an act is part of a regular activity or accidental in nature is judged on the basis of the facts. - Independent:
The performance of the activity must be on an independent basis and not in employment. There should be no bond of subordination to another person.
In international transactions with other legal entities within the EU, this VAT number is crucial, since a valid number leads to an invoice without VAT (a so-called intra-community transaction). Also, always check the validity of your counterparty’s VAT number, since if the number is invalid, the normal VAT rate applies.
If required, we can complete the application forms for opening a bank account for your new BV for you. This is possible at a Dutch banking institution, but also, for example, at a German bank.
You must appear at the bank yourself at times for signing documents and picking up the bank card etc.
As of October 1, 2012, the bank statement is no longer required, and the minimum capital for the limited liability company has been abolished. Thus, the notary can establish the BV without first opening a bank account.
Opening a bank account with a Dutch bank is quite simple. Banks outside the Netherlands require multiple documents, often also legalized by a professional, such as a notary, tax advisor or lawyer.
If a non-Dutch legal entity or a non-EU resident is involved in the establishment of a Dutch BV, different conditions apply with regard to the supply of documents for the establishment of the BV.
The reason for this is that existing registers cannot be used where, for example, the residence of a director or shareholder can be checked. By means of other documents it should then be convincingly demonstrated where a person lives, and nationality and passport should be checked in another way. This will increase the cost of establishing a Dutch BV. If the above applies to you, please contact me in advance for a customized quote.
The certificate of incorporation and other documents will be drawn up in English, with the possibility of translation into another language as well.
Subsidiaries distribute their profits as dividends to the parent company. The participation exemption provides that these profits are exempt from taxation (VPB) at the parent company. This prevents the same profit within the group from being taxed twice. The exemption applies only to parent companies that own 5% or more of the shares in a subsidiary.
The company receiving dividends is not required to include these profits in its taxable profits. This also applies to capital gains (such as sales results) earned from an associate. Thus, within the group, corporate income tax is levied only once on profits.
The scheme applies to participations in domestic and foreign companies. Because profits are not re-taxed, foreign-based subsidiaries can compete with local companies on an equal tax footing.
The participation exemption applies only to shareholders who own an interest of 5% or more in a company. If the shareholder has had this interest for more than a year, the exemption will apply for another 3 years from the time the interest falls below 5%.
Example:
If the Holding BV in the Netherlands has a participation in Belgium, and this BVBA has already paid a tax of 30%, the distribution of profits from this BVBA to the Holding BV in the Netherlands is untaxed. Of course, the distribution from the Holding Bv to a natural person is again taxed (Box 2) at a total of 25%.
A BV in the Netherlands is subject to the following tax types:
Corporate tax
Corporate income tax is levied based on the following rates (2012):
€ 0 – € 200,000: 20%
€200,000 and more: 25%
A special rate optionally applies to profits from patented fixed assets or assets for which a WBSO statement has been issued. The tax burden on such assets is 5% instead of the above rates.
Sales Tax
Value added on the sale of goods or provision of services is subject to BTW. Until Sept. 30, the normal rate is 19%; as of Oct. 1, it is 21%. The VAT rate for food, books, hairdressing, bicycle repair, clothing repair, culture, sports, recreation and passenger transportation is 6%.
Dividend tax
The tax on paying dividends is 15%. In the case of distributions from a subsidiary to the parent (work BV to holding BV), the participation exemption applies, and no dividend tax is levied.
Payroll tax
In the case of employees performing work in the service of the BV, wage tax is due on the gross salary. In the case of a director who also holds more than 5% of the shares of the BV, you must take into account the minimum DGA salary of 42,000.00 euro (Article 12a Wet LB).
Transfer tax
The transfer tax rate for business property transactions is 6%. The rate for residential properties is 2%, i.e., if a limited liability company has, for example, a property that is used both as business premises and as a residence, the low rate of 2% applies only to the residential portion. The business portion will be subject to 6% transfer tax.
In the case of employees performing work in the service of the BV, wage tax is due on the gross salary. In the case of a director who also holds more than 5% of the shares of the BV, you must take into account the minimum DGA salary of 42,000.00 euro (Article 12a Wet LB).
Chamber of Commerce registration
In accordance with Article 177(3) of Book 2 of the Dutch Civil Code, the registered office of the BV must be located in the Netherlands. According to Article 180 Book 2 BW, the directors are required to register the BV with the Chamber of Commerce.
Registering a limited liability company is done by completing and submitting a number of forms from the Chamber of Commerce:
BV in formation (BV i.o.):
form 7: registration BV in formation
Form 12: registration officers for the BV i.o.
BV after incorporation notary:
form 3: registration BV
form 11: registration officers for the BV
We will complete these forms for you, if the order to establish the BV is received at our office. We also take care of the application for all tax numbers (OB, LB and VPB) and can be helpful in filling out the forms to apply for a bank account at a Dutch banking institution.
Therefore, if a Dutch legal entity only has branches outside the Netherlands, registration with the Chamber of Commerce must also take place. The details of the company abroad are not included in the Commercial Register. Please note that a BV always remains taxable in the Netherlands for corporation tax, in accordance with artikel 2 Wet VPB. Thus, the BV continues to receive a tax return form from the Dutch tax authorities, even if there are no taxable events in the Netherlands. There are no taxable events in the Netherlands when all activities take place outside the Netherlands, or when the actual management of the BV is outside the Netherlands. The BV is then taxable where the activities are carried out, or where the board makes the actual decisions.bv
Visit notary
If desired, the notary can establish the BV through a power of attorney. This power of attorney must then be co-signed by a professional (other notary, lawyer, accountant or tax advisor). This professional should certify that you have actually signed the power of attorney, so that the notary can also be sure that you are in agreement with the draft incorporation deed of the limited liability company.
Of course, you do not have to use the power of attorney, and you can also visit the notary and sign for the formation of the limited liability company on the spot.
We offer you the service of establishing the limited liability company via power of attorney, saving you the time and trouble of visiting the notary yourself.
Tax treaties Netherlands
The Netherlands has signed a lot of tax treaties. You can download these treaties from this page.
You can view the treaty per country and often per type of tax, and assess how double taxation is prevented and which country is competent to levy taxes. If you have any questions about this, please get in touch.
Set up your BV with Van Lier Advies.
Do you still have questions regarding the incorporation of a BV or would you like us to start working for you right away? If so, please fill out the contact form.
