Self-employed individuals (zelfstandige zonder personeel or ZZP'er in Dutch) are entrepreneurs who own their own businesses and work for multiple clients. People who want to freelance typically choose either a single proprietorship or a limited liability company (besloten vennootschap or BV).
Registration with The Netherlands Chamber of Commerce is the initial step in forming a sole proprietorship (Kamer van Koophandel, or KVK).
Make an appointment with the Chamber of Commerce to finish your registration once you have completed the form. Online appointment scheduling is available via the KVK website.
At KVK, you will need the following items:
You will be listed in the Commercial Register upon registration (Handelsregister). The KVK will submit your information to the Dutch Tax and Customs Administration, which will determine, based on your operations, if you are a VAT-entrepreneur. A freelancer or sole proprietor is typically a VAT entrepreneur, especially if you want to invoice customers abroad. Within two weeks, the Dutch Tax and Customs Administration should subsequently provide your VAT tax number and VAT identification number.
In the Netherlands, nearly all VAT-registered businesses are required to calculate and add VAT to service or product prices, regardless of their legal form. Once registered with the KVK, your business will acquire a number that must be included on all invoices and outgoing mail. Additionally, the VAT number should be included on invoices.
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Profits earned by sole proprietors are subject to income tax. In the Netherlands, income is categorized into three boxes, each of which has its own tax rate.
Box 1: Income subject to taxation from work and home ownership
Box 2: taxable income from an investment in a big business
Box 3: taxable income from savings and investments
The earnings from the proprietorship is considered taxable income from job and property ownership, thus it belongs in Box 1.
Each year, you must file your tax return online by May 1st. Utilize tax return or accounting software or a tax intermediary through the website of the Dutch Tax and Customs Administration to file a tax return in the Netherlands.
If the Dutch Tax Administration recognizes you as a business owner and you meet a certain number of required working hours, you may be eligible for certain tax benefits. You can benefit from the private business ownership allowance (zelfstandigenaftrek) if you:
Once these allowances are removed from your profit, you are eligible to an extra 14% tax reduction, under the SME profit exemption.
If there is no job relationship, the customer is not required to withhold payroll tax and social premiums.
As a self-employed (sole proprietor), you normally have to pay national insurance contributions (volksverzekeringen), and you'll be entitled to an old-age pension (AOW) once you reach the state pension age. The pension equals the minimum income, which you'll have to supplement yourself.
Note: This information is from official sources and should not be considered as a substitute for legal advice. Always check official websites or consult a lawyer or tax consultant before taking action.