The Netherlands has three VAT rates: the standard VAT rate, the reduced VAT rate, and the zero VAT rate.

This applies to most goods and services in the Netherlands, including general consumer products, clothing, and electronics. 

This rate (or low tariff) applies to a number of products and services such as food, medicines, books (including e-books), newspapers, magazines, online publications, and public transportation.

The zero rate applies to services related to cross-border and international transactions. This includes exports and certain services provided to non-EU customers. It also applies to the international air or water transport of passengers.

Some goods and services are exempt from VAT in the Netherlands. These include medical services such as consultations for individuals with doctors, paramedics, psychologists, dentists, and care homes. 

Educational services are also exempt from VAT. This includes legally regulated education as well as general, vocational, and arts education. 

Registered childcare centres and childminding services are also exempt from VAT in the Netherlands. 

A number of home care services may also be exempt from VAT, including privately operated care homes, hospitals, or other care institutions. 

Though not technically an exemption, small businesses with an annual turnover of under €20,000 can also apply for the ‘Kleineondernemersregeling’ — a scheme that allows for VAT exemption for small businesses.

For foreign businesses conducting business activities in the Netherlands that are VAT registered in their home state, the VAT registration threshold is nil. Until the end of 2024, businesses established in the Netherlands must register for VAT if they exceed the €25,000 annual turnover threshold.

For EU VAT-registered companies selling goods over the internet (distance selling) to consumers in the Netherlands, the VAT registration threshold is €100,000 per annum. Upon reaching this threshold, EU businesses must register with the correct tax authorities.

To register for VAT in the Netherlands, businesses can apply online through the Dutch Tax and Customs Administration website.

VAT-registered businesses must complete their VAT return digitally. From 2022, businesses have been required to use the Dutch tax administration’s business portal ‘Mijn Belastingdienst Zakelijk’. Returns should be completed in Dutch, so a fiscal representative may need to be appointed to complete returns on businesses’ behalf.  

The frequency of filing will be determined by the Dutch Tax and Customs Administration — filings are either monthly, quarterly, or yearly. Businesses will be informed when they must file.

For businesses selling digital goods and services, the place of supply determines where VAT will be charged and paid.

For Dutch (businesses established in the Netherlands) digital businesses selling to customers who are not established in the Netherlands but are within the EU, it is the customer who will be charged VAT, and will pay VAT in their own country. If the customer is located within a non-EU country, businesses established in the Netherlands selling digital goods and services do not pay EU VAT at all.

Businesses established in the Netherlands with a turnover — or expected turnover — of less than €10,000 per year from sales of digital goods and services to other EU member states can calculate the Dutch VAT and pay it in the Netherlands. If the €10,000 threshold is exceeded, the business should calculate the VAT that applies in its EU customers’ country.

For businesses not established in the Netherlands, but selling into the country, all B2C sales of digital products and services are subject to the standard VAT rate of 21%.

In accordance with the EU VAT directive, a local Dutch fiscal representative or agent is not required for businesses that are VAT registered in other EU member states. A fiscal representative is required for non-EU businesses.

In either case, a representative can help businesses overcome language barriers when managing obligations such as VAT filings.

In accordance with the EU VAT directive, a local Dutch fiscal representative or agent is not required for businesses that are VAT registered in other EU member states. A fiscal representative is required for non-EU businesses.

In either case, a representative can help businesses overcome language barriers when managing obligations such as VAT filings.

The Dutch tax office will require the appropriate forms to be completed and submitted with the following documentation:

• VAT certificate to prove the business is registered for VAT elsewhere 
• Articles of association
• An extract from the company’s national trade register

The tax point is the time when VAT becomes due. VAT due should be distinguished from VAT payable. VAT is due when the tax point occurs. VAT is payable between the day after the end of the reporting period and the due date to submit and pay the VAT return.

A tax point arises when the invoice is issued. Invoices must be issued at the latest by the 15th day of the month following the month in which the supply was made. 

If the invoice is not issued, or issued late, then the tax point occurs at the latest on the date on which the invoice should have been issued. 

Prepayments and advanced payments also create a tax point. 

For these types of transactions — between VAT-registered businesses in other EU countries — a tax point occurs on the invoice date or the 15th day of the month following the month in which the invoice was issued.

A tax point occurs when the goods are imported, as confirmed by the relevant shipping and import documents.

Once a business has completed the VAT registration process, a unique Dutch VAT number is allocated to the business. All EU member states have a fixed format for their VAT numbers. In the Netherlands, it includes 9 digits and the prefix NL.

A tax point occurs when the goods are imported, as confirmed by the relevant shipping and import documents.

Once a business has its VAT number, it is free to commence trading in the Netherlands and charge Dutch VAT.

The business must comply with Dutch VAT compliance rules and file regular returns.

Researching Dutch VAT legislation is the first step to understanding your VAT compliance needs. Avalara has a range of solutions that can help your business depending on where and how you trade.

Researching Dutch VAT legislation is the first step to understanding your VAT compliance needs. Avalara has a range of solutions that can help your business depending on where and how you trade.