The Netherlands is known all over the world for providing a favorable climate for entrepreneurs, and it’s a popular destination for investors. That’s hardly surprising given the country’s strategic location and well-developed infrastructure.
Historically, American companies often chose the United Kingdom as the base for their European operations, but that’s no longer the case following Brexit, making the Netherlands the obvious alternative.
It is a country renowned for its free-market and welcoming attitude toward foreign entrepreneurs. If you want to do business in Europe, this is the place to start. It provides:
- Tax treaties with over 80 countries;
- A favorable tax framework for foreign companies;
- Ideal IT infrastructure;
- Locals who are highly educated and proficient in English;
- Stable economy and fiscal policy;
- Minimal labor conflicts and strikes.
The Netherlands is known all over the world for providing a favorable climate for entrepreneurs, and it’s a popular destination for investors. It attracted many foreign investors who came here to benefit from the local opportunities and start new businesses. You’ll still have to deal with a bit of red tape. It will be your responsibility as a business owner to report and pay your taxes correctly and obtain all the appropriate licenses and permits.
While almost anyone can start a business here, the process and requirements will depend on a series of factors.
Check Your Eligibility to Stay In the Netherlands
As a first step, you need to make sure you can live and work in the Netherlands. Under EU legislation, EU, EEA, and Swiss nationals are allowed to reside and work here. If you are neither a citizen of an EU or EEA country nor a Swiss national, you must apply for a provisional residence permit (MVV) and, in some situations, a work permit (TWV).
Self-employed entrepreneurs can also apply for a Dutch residence permit. This application uses a point-based system, and you need to obtain a certain number of points for your application to be approved. Your company must, first and foremost, serve an important Dutch interest.
You may also be eligible for a startup visa if you plan to start an innovative company. The Netherlands began offering this type of visa in 2015. It’s a one-year residency visa designed for foreign entrepreneurs looking for business opportunities in the Netherlands.
You’ll likewise need a business bank account. The Dutch Banking Association (Nederlandse Vereniging van Banken) has developed a Quick Scan to assist you in determining your eligibility.
Write a Business Plan
When starting a business, it’s a good idea to prepare a business plan. This is where you’ll outline various aspects of your vision like legal business structure, what you intend to produce and/or sell, your target audience, and financing. You’ll also want to make sure that there’s a demand for your company’s profile in the Netherlands.
These are all issues that need to be addressed before investing in a business concept.
Choose a Legal Business Structure (Rechtsvorm)
Choosing a legal business structure is a very important step because it determines your liability and tax obligations. You want to make sure you pick one that fits your needs. It’s an aspect that can be difficult to navigate, but there are expert services available to assist you.
Additionally, there are companies that specialize in working with foreign entrepreneurs that can help you with marketing. To find one, you can simply search for “digital agency Rotterdam” or any other Dutch city where you’d like to set up shop.
The following is a list of Dutch business forms – rechtsvormen.
Unincorporated business structures – Rechtvormen zonder rechtspersoonlijkheid:
Choosing an unincorporated business structure implies that you are personally accountable for your company’s debts, and your assets are not protected.
- Sole proprietorship – Eenmanszaak;
- General partnership – Vennootschap onder firma (VOF);
- Professional partnership or commercial partnership – Maatschap;
- Limited Partnership – Commanditaire vennootschap (CV).
Incorporated business structures – Rechtvormen met rechtspersoonlijkheid:
Choosing an incorporated business structure implies that you and your private assets are protected from debts incurred by your business in most circumstances.
- Private limited company (Ltd. or Inc.) – Besloten vennootschap (BV);
- Public limited company (PLC or Corp.) – Naamloze vennootschap (NV);
- Cooperatives and mutual insurance societies – Coöperatie en onderlinge waarborgmaatschappij;
- Foundation – Stichting;
- Association – Vereniging.
Different legal structures work better for different businesses. Freelancers and small business owners, for example, typically use the ‘eenmanszaak’ structure (sole proprietorship), but the most frequent form for larger companies is a BV(private limited company).
A dentist would probably choose a ‘maatschap’ (professional or commercial partnership), while someone running an NGO might choose a ‘stichting’ (foundation).
Register Your Business with the KvK
Once you’ve decided on the type of business you want to start, you can register it with the Kamer van Koophandel or KvK for short. This is the Dutch Chamber of Commerce. After you register it with them, they will enter your business into the Dutch Trade Register.
You should register your business with the KvK between one week before and one week after you begin operations. You first should register with your local municipality, or you’ll have to show authenticated proof of your address abroad.
You will need to choose a business name – you’re allowed to register more than one – and describe the activities your company will be engaged in. The KvK also has a search page where you can check if other businesses use the names you’re considering.
Keep in mind that if you choose an incorporated business structure, you will need to register it through a notarial deed, and the notary will be the one who submits the KvK registration paperwork.
Employer Registration for Payroll and Social Security Taxes
You must first register as an employer with the Dutch Tax and Customs Administration if you plan to hire people. Whether you’re a newcomer or have lived in the Netherlands for a while, understanding the Dutch tax system can be difficult. This is especially true if you are launching your own business.
Fortunately, the Netherlands has a variety of expat-friendly tax consultants. These can provide assistance with different tax-related concerns in English or other languages. Freelancers and other self-employed professionals can find resources in the Netherlands through the Business.gov.nl website.
Check Whether You Require Professional Certifications
In most cases, establishing a business in the Netherlands does not require a separate qualification, but this depends on your profession. Some professions, such as those in the medical, legal, and scientific fields, are regulated, so you’ll need to provide a recognized qualification.
If you earned your degree or certificate outside the Netherlands, you need to apply for permission to practice in the Netherlands.
