Open a company in Europe to purchase goods – tax questions

We are planning to open a company in Europe for the purchase of products in the Netherlands, for export to our customers in Latin America and Asia. But i will appreciate if you can give us some comments about our 2 main doubts regarding open or not a company in Netherlands.

The first doubt is about the IVA/VAT  Please confirm if a company in Netherlands that buy from Italy and export the product out of Europe need to pay the IVA for the Italian Supplier?

The second doubt is about the personal Income tax. I’ve been checking the Legacy website and seems that the profit distribution rate in Netherlands is quite high, compared to other European countries, such as Portugal.

I understand for a company that has a profit over EURO 200.000,00, we have to pay 25.8% of corporate income tax. And more 49,50% as personal Income tax for the balance. Is this correct?

Answer:

Please find below the high level answers your questions:

The overall, general rule is that in case goods are delivered from one EU country (e.g. Italy) to another EU country (e.g. the Netherlands), a 0% VAT rate applies. This 0% rate also applies in case goods are delivered from an EU country (e.g. the Netherlands) to a non-EU country (e.g. Latin America or Asia). Whether this 0% rate also applies in your case should be confirmed based on a more detailed review.

Profits realized by a Dutch resident company (i.e. a BV) are subject to the following corporate income tax rates:

Profit20222023
SME tariff15% (up to €395.000)19% (up to €200.000)
Standard tariff25,8% (profits exceeding €395.000)25,8% (profits exceeding €200.000)
Innovation Box9% on profits derived from qualifying innovative activities9% on profits derived from qualifying innovative activities

Meaning that the first amount of profit will be taxed at the lower rate and everything over that amount will be taxed at that higher rate.

Personal income tax should not be due, assuming that none of the (ultimate) shareholders of the Dutch company (i.e. the BV) is a tax resident of the Netherlands and the BV is owned by a company with an active trade or business (to be confirmed).

Read more on taxation in the Netherlands.

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