We are thinking of setting up our company in the Netherlands and our question is of vat nature. What is the vat for online educational services? Both teachers and students will be based most likely outside the netherlands.
This is a complex situation.
Official institutions which offer education are VAT exempted. The same is applicable to institutions or companies which offer professional education and are registered in the Register Short Professional Educatio: www.crkbo.nl
. If you will not register you will have to charge VAT.
Next step is to determine who your client is. If your client is living in the Netherlands the standard rules which I mentioned above are applicable. If your client is however living outside or based outside the Netherlands this can be different. Then we have to make a difference again between individuals and companies and whether they are living or based inside or outside the EU. And of course we have to determine how the service you offer is categorized.
EU regulations determine that online education is classed as an electronic service. For electronic services again special rules apply.
Your client is:
- a business based in another EU country: you charge 0% VAT, your client will declare VAT in its own country
- an individual living in another EU country: you charge 21% VAT, unless you are registered for professional education (0% VAT)
- a business based outside the EU: you charge 0% VAT, you need to check how VAT will be declared in the country of your client
- an individual living outside the EU: you charge 0% VAT, you need to check how VAT will be declared in the country of your client
So when you let your students register it is important you have all their details. Based on the information they provide you will have to determine the VAT position which can be different every time. It becomes more complicated if your client is based outside the EU. Make sure that if your client is a business that you have their VAT number.
Expatax can assist you with setting up the business, with the VAT registration and the daily accounting.