VAT in the Netherlands
Subject to VAT
The value added tax system in the Netherlands corresponds with that currently used by all other EU-states. The following transactions are subject to VAT:
- The provision of goods and services by businesses within the Netherlands;
- Intra-Community purchases of goods in the Netherlands in the course of business operations by entrepreneurs and corporations;
- Intra-Community acquisitions of new means of transport;
- Imports of goods from outside the EU.
The tax is levied on the sale price and the general rate is 21%. A lower rate of 6% applies for certain goods and services, such as food products, books, medicines, art, antiques, entry to museums, zoos, theatres and sports. Visible exports are zero-rated. A number of exemptions apply for special goods and services such as educational, medical and cultural services.
VAT is payable by entrepreneurs operating a business in The Netherlands, either as natural or legal persons. Entrepreneurs who form a group from a financial, organisational and economical point of view may request treatment as a fiscal unity for VAT purposes. Foreign entrepreneurs are also liable for Dutch VAT if they operate a business in the Netherlands.
VAT on expenses
Entrepreneurs may deduct VAT paid on purchases and other business expenses from the VAT payable on their sales. If an exemption applies, VAT payments are not deductible.
Once an entrepreneur has registered the business with the tax office then a VAT number will be provided and VAT returns will be sent at the applicable dates.
Examples of questions answered in our Knowledge Base:
- What are the VAT rates in the Netherlands?
- Which information should be mentioned on an invoice to my client?
- How are VAT returns filed?
- My business is not VAT registered. Can I still reclaim VAT we have paid for goods/services?
- Can I request a time extension for filing the VAT return?
- In which quarter will I have to declare the VAT?