Paying Taxes in the Netherlands

1. What is the corporate tax in the Netherlands?
In Netherlands the corporate tax applies to a standard rate of 20%. If the annual profit exceeds € 200.000 the rate is 24% (effective 2012).

2. What is the VAT in the Netherlands?
Value Added Tax in Netherlands applies to all goods and services by businesses within Netherlands and also imports of goods from outside EU. The standard rate of VAT in Netherlands is 19%. A reduced rate of 6% applies for certain goods and services such as food, books, medicines, art etc.

3. How can the VAT be refunded in the Netherlands?
The VAT rate in Netherlands applies to the sale price of goods and services, affecting the profits of companies. However the VAT amount can be recovered in Netherlands by submitting an application to the Dutch tax authorities. The application must be signed by the business owner and must contain the original invoices. The form should concern a minimum period of three months and a maximum period of one calendar year. The minimum tax amount to be refunded should be at least 200 euros for a three month period, and 25 euros for a calendar year. The Tax and Customs Administration usually sends the refund within 6 months since the day the application was sent, in case the refund has been agreed.

4. What is the dividend tax in the Netherlands?
The Dutch Tax Law imposes a dividend withholding tax of 15%, while the tax per value of share is 1, 2 % payable each year.

5. Are there any incentives for foreign investors in the Netherlands?
The main attractions for foreign investors in Netherlands are the stable economy, welcoming environment and the wide range of possibilities. Also the private sector of the country's economy is thriving and incentives are available in many fields. The Dutch government offers preferential loans and grants mainly in development, schooling, infrastructure, health and internet and communication.

6. Why do I need a local accountant for my Dutch business?
The Dutch financial system is comprehensive and straight-forward. However accountants are needed in most companies. It is advisable for a foreign company to work with a local accountant for a better understanding of the economical environment. Also the extended experience of a local accountant can prove useful in dealing with financial issues.