The Netherlands has been climbing its way up into being one of the most desirable countries for starting a business. Also, every year the number of digital nomads who choose the Netherlands as their working place increase.
Stability, vast economy, quality of life, and geographical location are just some of the reasons that attract thousands of business people and entrepreneurs.
The Netherlands’s GDP per capita amounts to 57,768 (or 1.013 trillion USD for the entire country). That’s why it’s the fifth largest economy in Europe (per capita). Also, it’s in the seventh spot of Europe’s largest economies (taking into account nominal GDP.)
The Netherlands is a relatively small country in size and population. However, it managed to build a robust but growing economy.
So, what’s their secret? It’s understanding future trends and implementing the Dutch Digitalisation Strategy with digital advancements. The business sector has witnessed around 35,000 new registered businesses in the Netherlands in 2020 alone.
Its regulatory business structure is definitely something they can flaunt. Let’s take a closer look at how the Netherlands became the bustling business hub of Europe.
Why Register a Business in the Netherlands?
Most individuals take extra precautions before starting a business. So, naturally, it’s necessary to “test the waters” and analyze if the environment is prolific for starting a business.
When it comes to the Netherlands, numerous factors make this decision much easier.
Firstly, the tax laws of the Netherlands have been modified to aid newly opened businesses. If the taxable amount is less than €395,000, the corporate income tax is 15%. That’s close to 10% lower than the global average, making it a significant boost for establishing and developing your business.
Innovative research receives even more benefits, lowering the corporate income tax all the way down to 9%. The Dutch are truly investing in technologies of the future.
Also, the Netherlands introduced a double taxation treaty. If you have income from both the Netherlands and another country, you don’t have to pay tax twice on the same income.
This agreement is valid for over 90 countries, so the chances are high that yours will be included. Here, you can check if your country is included as the Netherlands’ tax treaty partner.
The paperwork is not the only important thing here. Getting around, doing business, and having a social life are important for every individual. This is where a language barrier can be a problem. Fortunately, almost 95% of the population speak English, 71% speak German, and 29% speak French. Most Dutch people speak fluent English, so you can relax if yoу’ve yet to learn Dutch.
Due to its geographical location, the Netherlands is surrounded by other economic and business giants, such as Germany, France, and the UK, making Europe’s biggest consumers easily approachable. Also, the Netherlands is an EU founding member state and a part of the Eurozone, NATO, OECD, G10, and WTO, the trilateral Benelux Union, and a part of the Schengen Area. It thus brought political stability, as well as excellent international relations.
With more than two million registered businesses, a highly qualified workforce, and growth potential, it’s no wonder the Netherlands ranks as the second-best country for entrepreneurs in a list compiled by NECI.
How to Register a Business in the Netherlands in 9 Steps
Step 1 – Find out if you are legally entitled to start a business in the NL
Before opening a business there, you need to sort out the paperwork and match the criteria required for business registration.
If you’re an EU citizen, you will be able to move to the Netherlands and register your business without additional paperwork.
On the other hand, if you aren’t an EU citizen, there are a couple of things to keep in mind. First, you’ll need to obtain an MVV visa and a residence permit, depending on your country of origin.
If you’re interested in innovative business registration, you may apply for a different type of visa called a startup visa. This visa will allow you to stay in the Netherlands for up to one year, but you have to develop a product or service that is new to the Netherlands. An experienced facilitator will enable this to ensure that both you and the country benefit from this business model.
Finally, before registering a business in the Netherlands, you need to apply for a business bank account (IBAN). Then, you can do a quick scan to ensure that you’re eligible to open a business bank account in the Netherlands.
Step 2 – Make a business plan
Thorough planning before taking any drastic steps is the best approach for setting up for success. Banks usually ask their clients for their business plan before investing or giving out a loan, so preparing it in advance may also be beneficial.
In short, a business plan is an overview of the financial, organizational, and marketing strategies to put your idea into practice.
It can also be necessary to choose the proper business model for your idea, as different legal business structures fit different business models.
Writing down these details may inspire and make it easier for some of the business sectors.
Step 3 – Choose a business name
A unique business name makes you stand out on the market. However, there are a couple of rules to keep in mind when registering your business name:
- You can’t use a business name that another company already uses. If you’re unsure whether that business name already exists, you can type it in the Business Register and search through the existing ones.
- Your company name shouldn’t mislead customers and suppliers. This implies that the name of your business should be different from that of a business that provides the same goods or services in the same locale.
- Your company’s name should follow the legal structure of your business so the customers know what they’re getting.
- You’re allowed to use your name in your company’s name, but you’re prohibited from using someone else’s name.
Step 4 – Decide your business structure – which legal form
There are a few business structures in the Netherlands, each convenient for different business models. However, before registering a business in the Netherlands, you need to choose one of the following legal forms:
- Sole proprietorship: the Dutch eenmanszaak
This implies that you’re solely responsible for the company and its profit/debt without legal personality.
- General or commercial partnership: the vennootschap onder firma (vof)
A general partnership is a business structure with at least two people involved with the company, where each person serves as a partner. All involved must contribute through financial or labor services.
- Professional or public partnership: the maatschap
In this scenario, you would work alongside other professionals as a self-employed entity.
- Limited partnership: the commanditaire vennootschap (cv)
This business structure is like a general or commercial partnership with at least two people involved. The difference is that there are members who are “silent partners.” They are involved financially but aren’t involved in the company’s operational staff.
- Private limited company: the besloten vennootschap (bv)
With a private limited company, you can have a director’s position without the responsibility for any debt; however, your function capacity will be limited.
- Public limited company: the naamloze vennootschap (nv)
This implies that the company will be led by its board, with its capital divided among shareholders who can appoint or dismiss the board.
- Cooperative: the coöperatie
Here, the members can join or leave the company without compromising its continuance.
- Association: the vereniging
An association is a non-profit business model with at least two members who organize social activities. If any profit is made, it is reinvested in the association.
- Foundation: the stichting
This business structure is similar to the association, with the similarity being its non-profit nature. As a foundation, you are collecting money from donations and similar sources to fund charities, hospitals, museums, and the like.
Step 5 – Comply with national and European regulations: apply if needed for permits and licenses
There are a few permits and licenses you’ll need to obtain to become a full-fledged citizen, such as a visa, residence permit, work permit, and the like. Different documents are required in different scenarios, so check out the business government page to ensure there aren’t any split ends.
Step 6 – Look for a location
When picking a location for your business, you’ll definitely want to find an attractive spot where your customers can easily reach you. But, before pinpointing the exact location, make sure that you investigate the zoning plan.
The zoning plan is an expansion strategy for a particular location. It has all of the infrastructure mapped out, with height and width measurements.
If a certain location is a critical point for your business, you can also apply for an All-in-one Permit for Physical Aspects and try to modify the zoning plan to your benefit.
Step 7 – Register the company at the Chamber of Commerce (KVK)
If you complete all these steps, you’re ready to set up an appointment with Kamer van Koophandel (Chamber of Commerce).
To do so, you first need to fill out an online form consisting of your personal details, as well as your business’s details. The form must be filed in person, so upon completing it, you need to visit the nearest KVK office (there is an office in each city in the Netherlands). After that, you need to make an appointment for your registration.
There is a fee for registering your business, summing to €75, which is a one-time payment.
You must present your business premise lease, purchase contract, or a letter of consent signed by the owner or landlord of the business premises if your business address and private address are different.
You can register one week before starting your business or one week after starting your business (at the latest).
You can do it earlier as well, with your registration number (KVK Zoeken) becoming official one week before launching your business.
Upon registering, it usually takes 4-5 weeks for the registration’s approval.
Step 8 – Arrange financial administration – taxes and bank account
Once you register with the KVK, your business will automatically be registered with the Tax and Customs Administration. On the other hand, if you’re a foreign company representative (not listed in the Dutch Business Register), you are required to perform the registration with the Tax and Customs Administration yourself.
There are other forms of taxes to keep in mind as well:
- VAT tax – a turnover tax
- Income tax – tax for sole traders
- Corporate tax – tax for private limited company owners
- Dutch dividend tax – In case of distributing profits in a public limited company
- Business tax advice for foreign companies – For a foreign business that is branching out to the Netherlands
- Municipal, waterboard, and provincial taxes – local taxes for utilities
Step 9 – If needed, look out for staff with agencies and get to know labor law
There are agencies in the Netherlands that will provide assistance with staff appointments if needed. If so, go through the Netherlands labor law to ensure that your requirements, as well as the worker’s, are met.
What Documents and Requirements You’ll Need to Register a Business
To register a business in the Netherlands, you’ll need a couple of documents:
- A certified copy of your ID
- A copy of a contract for the lease, renting, or sale of your Dutch business address
- A civil status record from your municipality, a document from an official institution, or a legalized original extract on which your foreign address is stated (bank statement, for example)
However, there are a few other things to keep in mind when migrating to the Netherlands for business purposes.
Firstly, you may need an MVV visa and/or a residence permit to authorize your stay. If your country of origin is Switzerland or a member of the EU/EEA states, you are not required to obtain either.
If you plan on starting your business in the Netherlands but you’re a resident of a country outside of the mentioned, then you may need an MVV visa or a residence permit, or both, depending on the country.
You need a residence permit if you want to relocate to the Netherlands for work purposes and you’re a citizen of Australia, Canada, New Zealand, Japan, or South Korea. You’re permitted to stay in the Netherlands for up to 90 days without a visa. While you wait for the approval of your application, those 90 days may be extended. The same goes for Andorra, Monaco, San Marino, Vatican City, the United Kingdom, and the United States, as long as you are moving to the Netherlands primarily for work-related reasons.
Argentina, Hong Kong, Taiwan, and Uruguay are the next group of nations, and they are subject to a specific set of restrictions. You’ll need to apply for a residence permit even if you’re a citizen of one of these nations. But it’s possible that the MVV visa isn’t required. For instance, you’d need to obtain an MVV visa if your firm transferred you to the Netherlands. The MVV visa is not required if not.
If you’re a citizen of one of the nations not already mentioned, you’ll automatically need to apply for both an MVV visa and a residence permit.
The next needed document is the work permit (tewerkstellingsvergunning, TWV). It’s frequently included in your residence permit if you’re staying in the Netherlands as an independent contractor, self-employed professional, or for a startup. The length of your stay will determine this.
Every person registered in the Personal Records Database (basisregistratie personen, BRP) receives a special personal number known as a citizen service number (burgerservicenummer, or BSN). Everyone who registers with the BRP receives a BSN automatically.
Finally, you’ll need to provide other details, such as your education and medical care info, which can be found on the government website.
Move, Expand or Register Your Brand New Company ASAP
The Netherlands will be thorough with preparations and documents for kicking off your business career.
It may seem complicated, but it’s a setup for success. Every individual is viewed as equal, with maximum support for advancing their career.
The staff of each paperwork office will be at your absolute disposal to help you to complete the process smoothly. However, if you’d like to bypass it, you can hire professionals that will do the work for you.
The only thing left to do then is to start packing your bags and prepare for the next, most successful chapter of your career in the business center of Europe!