Located at the heart of Europe, the Netherlands is a gateway to the EU market and a strategic choice for international business expansion.Known for its business-friendly environment, transparent regulations, and efficient digital infrastructure, the Netherlands consistently ranks among the most competitive economies worldwide. Whether you’re a startup or an established multinational, setting up a company in the Netherlands offers access to skilled talent, a reliable legal framework, and a stable Eurozone economy.
Country Overview
• Official Name: Kingdom of the Netherlands (Koninkrijk der Nederlanden)
• Capital: Amsterdam (Government center: The Hague)
• Population: Approximately 17.5 million (as of 2024)
• Official Language: Dutch (Flemish); Frisian is also official in some regions
• Religion: Secular state; a significant portion of the population is non-religious. Christianity (especially Catholicism and Protestantism) is widespread
• Climate: Temperate maritime climate; summers are cool, winters are mild, and precipitation occurs throughout the year
• Time Zone: UTC+01:00 (UTC+02:00 during daylight saving time)
• Phone Code: +31
• Currency: Euro (EUR)
Types of Companies and Business Structures in the Netherlands
| Structure Type | Establishment Method | Minimum Capital | Liability | Description & Features |
|---|---|---|---|---|
| BV – Private Limited Company | Notarial deed of incorporation; possible via PoA | €0.01 | Managed by a board; shareholders liable only up to share capital | Most common type. Suitable for SMEs. Remote setup and bank account opening possible. Corporate shareholders and directors allowed. Subject to Dutch corporate tax. |
| NV – Public Limited Company | Notarial deed of incorporation | €45,000 | Managed by a board; shareholders have limited liability | Suitable for large-scale operations or IPOs. Directors appointed via general assembly. Designed for companies seeking public investment. |
| Branch Office | Registered through parent company in Dutch Trade Register | None | Parent company fully liable | Can engage in commercial activities. Less regulated than a subsidiary. May be subject to Dutch taxation. |
| Representative Office | Simple registration | None | Limited (no commercial activity) | Only allowed for marketing, liaison, and coordination. Cannot perform direct business or commercial transactions. |
| Maatschap – Professional Partnership | Written or notarized agreement | None | Partners are jointly and severally liable | Suitable for freelancers and professionals (doctors, lawyers, etc.). No legal personality. Subject to personal income tax. Public version exists for legal professionals. |
| VOF – General Partnership | Written (preferably notarized) agreement | None | All partners are 100% personally liable | Must be registered with the Trade Register. Suitable for commercial businesses. Income taxed individually. |
| CV – Limited Partnership | Written (preferably notarized) agreement + registration | None | General partner: unlimited; Silent partner: limited to capital | Requires at least one general and one silent partner. Silent partner cannot participate in management without full liability. Often used for investment/holding. |
| Stichting – Foundation | Notarial deed of formation | None | Managed by a board | May carry out commercial activities. Used for holding, tax planning, and charitable purposes. May be exempt from taxes/reporting depending on structure. |
Taxation in the Netherlands
In the Netherlands, corporate income tax is calculated on the taxable profit after deducting allowable losses from annual earnings.
| Taxable Profit (EUR) | Corporate Tax Rate |
|---|---|
| €0 – €200,000 | 19% |
| Over €200,000 | 25.8% |
Value-Added Tax (VAT / BTW)
| VAT Type | Rate | Application |
|---|---|---|
| Standard Rate | 21% | Most goods and services |
| Reduced Rate | 9% | Essentials such as food, medicine, books, public transport, accommodation |
| Zero Rate (0%) | 0% | Exports, intra-EU supplies, certain international services |
Note: Businesses with a valid VAT number are entitled to reclaim input VAT.
Tax Overview of Legal Business Forms
| Legal Form | Formation | Capital Required | Liability | Taxation |
|---|---|---|---|---|
| Sole Proprietorship | Free of charge | None | Fully personal liability | Income tax, SME profit deduction, payroll taxes (if hourly threshold is met) |
| Private Limited (BV) | Notarial deed | €0.01 | Board of directors liable | Corporate tax, income tax on director salaries and dividends |
| Public Limited (NV) | Notarial deed | €45,000 | Board of directors liable | Corporate tax, income tax on director salaries and dividends |
| Partnership (Maatschap) | Written or notarized agreement | None | Partners are equally and personally liable | Income tax, SME profit deduction, payroll taxes (if hourly threshold is met) |
| General Partnership (VOF) | Written or notarized agreement | None | All partners are personally and fully liable | Income tax, SME profit deduction, payroll taxes (if hourly threshold is met) |
| Limited Partnership (CV) | Written or notarized agreement | None | General partner: unlimited; Silent partner: limited to capital | General partner: income tax, SME deduction, payroll taxes (if hourly threshold is met) |
| Foundation (Stichting) | Notarial deed | None | Board of directors liable | Subject to corporate tax if engaged in commercial activities |
What is the SME Profit Deduction?
Applicable to sole proprietorships and partnerships, this tax incentive allows eligible businesses to deduct 14% of their taxable profit. In effect, only 86% of their net income is subject to tax.
Why should you invest in the Netherlands?
As a member of the European Union, the Netherlands is an attractive hub for international entrepreneurs thanks to its strategic geographical location, stable economic structure, diverse range of companies, and investor-friendly tax system. Thanks to its extensive transportation network, robust infrastructure, and easy access to the European market, a company established in the Netherlands has the potential to grow not only locally but also on a global scale.
We can guide you through all processes, from company formation to tax planning, and help you determine the most suitable structure for your needs.Contact us to establish a strong and sustainable business in the Netherlands.
