VAT in the Netherlands, in one overview

Calculate VAT

Have an amount without VAT and want to know what goes on the invoice, or an amount with VAT and want to work back? Pick the rate and you see the three lines of an invoice.

Which rate do you charge?

The standard rate is 21%. It applies to all goods and services that do not fall under 9% or 0% and are not exempt. For most freelancers in IT, consulting or new construction, 21% is the only rate that ever appears on their invoice.

The 9% rate applies to a limited list. For goods: food, water, medicines and medical aids, books and magazines, flowers and plants, and art (under conditions, for example when sold by the artist). For services, among others: hairdressers, repairing bicycles, shoes and clothing, passenger transport, admission to sports, culture and recreation, and food served in restaurants and cafés. If you work in and around people's homes, this is the part that matters: insulating, painting, plastering and wallpapering a home that is more than two years old falls under 9%, and so does cleaning inside a home — however old the home is. Other work on homes is taxed at 21%. If the 9% work is part of a larger job, you split the two rates on your quote and your invoice.

0% and exempt are not the same

You use the 0% rate mainly when you supply goods abroad; the invoice then states that the 0% rate was applied. If you supply a business in another EU country, its own rules come on top — your customer's VAT ID on the invoice, box 3b and the ICP return — and those are in the guide on selling within the EU.

Exempt is something else. An exempt activity — including healthcare, education, childcare, financial services and insurance, and the work of writers, composers, cartoonists and journalists — carries no VAT at all. You charge no VAT, and you may not deduct the VAT on the costs of that activity as input tax. If you do both exempt and taxed work, you only deduct VAT on the costs of the taxed part.

Your VAT numbers and the return

After registering with the KvK you receive two numbers from the Dutch Belastingdienst. The VAT identification number (btw-id) is for your customers: it goes on your invoices and your website. The VAT tax number (omzetbelastingnummer) is only for contact with the Belastingdienst itself; for a freelancer the first nine digits are your citizen service number (BSN), so that number never goes on an invoice.

You file the VAT return per month, quarter or year; most entrepreneurs file per quarter, by the last day of the month after the quarter. The return shows the VAT you charged your customers, minus the VAT you paid yourself on business costs. If the difference is positive you pay; if it is negative you get it back. You also file when you had no turnover in that period. How to fill in boxes 1a to 5b is in the guide on the VAT return.

The three exceptions

The small business scheme (KOR): if you are established in the Netherlands and your turnover is no more than €20,000 in a calendar year, you can register for it. You then charge no VAT and in principle no longer file VAT returns, but you don't get the VAT on your costs back either. Reverse charge (btw verlegd): if you work as a subcontractor in construction, it is not you but your contractor who reports the VAT — your invoice states 'btw verlegd' and your customer's VAT ID. Selling within the EU: to a business in another EU country with a valid VAT number you supply at 0%, and you report that supply on your ICP return. Each of the three has its own guide in this knowledge base.

In booxx you choose a VAT code per invoice line: 21%, 9%, 0%, exempt or reverse charge. The codes are set up by default, and each code knows which box of the return it belongs in; an invoice with one line at 9% and one at 21% therefore counts in two boxes by itself. If you fall under the KOR, you set that in your administration: the VAT disappears from your invoices, and the exemption statement appears on them. The software works in Dutch, English, Polish, Hungarian and Romanian, and you can try it for 90 days without a payment method.