Tax in the Netherlands 2023

Tax rates in the Netherlands vary depending on your income and the type of taxes you are paying. This guide provides information on the type and amount of taxes entrepreneurs running small or medium-sized businesses will need to pay. The following taxes may apply, depending on your situation:
  • Personal income tax / wage tax
  • Corporate income tax
  • Dividend tax
  • VAT

Furthermore, as a worker in the Netherlands you must normally pay social security contributions. Finally, several types of tax credits and subsidies can decrease the total tax liability of a self-employed person in the Netherlands.

How much tax does a BV pay in the Netherlands?

The amount of tax paid depends on various factors. It is important to differentiate between the taxes the company has to pay and the personal tax the shareholder, director or employee needs to pay.

A simple BV usually pays corporate income tax over its profits and VAT on purchased goods or services. In turn, the person behind the company, is usually liable for wage tax (if employed by the company), tax on substantial interest (if any dividends distributed) and personal income tax on all other income.

Corporate tax in the Netherlands (BV)

First of all, a BV will pay corporate tax on its profits. If the company does not make a profit, zero corporate tax is due.
This particular tax uses a progressive rate of taxation. Meaning that the corporate tax rate is calculated based on how much taxable income you generate; the higher your income, the higher your liability. Additionally, businesses may be eligible for various deductions and incentives which could reduce their overall taxes payable.
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

Personal income tax (BV or sole proprietorship)

Personal income tax is an annual tax on a person's worldwide income. The tax currently consists of two brackets:
Personal Income Tax (IB)20222023
Bracket 137,10% up to €68.50836,93% up to €73.031
Bracket 249,50% from €68.50849,50% from €73.031
Employers are responsible for withholding payroll taxes from employees' salaries, which saves the workers from having to pay them separately as income tax. This levy is composed of wage tax (loonbelasting) and national insurance contributions directed toward pensions, unemployment allowance, and other Dutch benefits and allowances.

Substantial interest tax on dividends (BV)

Dividends received by a shareholders-directors with 5% or more of the shares in a BV in the Netherlands are subject to box 2 income tax. The amount of tax due will depend on the total amount of dividend income and any applicable deductions or credits. Since the effective total tax on dividends is substantially lower than tax on the director-shareholder's salary, the Dutch tax authorities have introduced a mandatory salary. This DGA-salary is set at 51.000 euros in 2023. Generally, if the company is not able to pay for this, it is not forced to pay out such a salary. A decrease of this DGA-salary can be applied for at the Dutch tax authorities.

Important: never pay out dividend before paying out the mandatory DGA-salary.

Box 2: Substantial Interest202220232024
Up to €67.00026,9 %26,9 %24,5 %
Over €67.00026,9 %26,9 %31 %

Wage tax for Director-Shareholder (BV)

A shareholder-director with at least 5% of the shares in a BV, will need to pay a DGA-salary of at least 51.000 euros in 2023. You are required to pay both Box 1 personal income tax and social security contributions on your salary. This Box 1 personal income tax rate is determined by your total income and dependents. Depending on your personal circumstances, you may be able to reduce your total liability through deductions or credits available in the Netherlands.

20222023
Gross annual income48.00048.000
Personal income tax- 17.793- 17.726
Health insurance contributions- 2640- 2.606
General tax credit+ 1.286+ 1.526
Labour discount+ 3.595+ 4.377
Net income32.44833.571
Tax burden (incl. healthcare)32,4%30,1%

How much tax do I pay as a ZZP / Eenmanszaak in the Netherlands?

A sole proprietorship in the Netherlands is considered to be a "natural person" for tax purposes, and as such, the owner is subject to personal income tax. The exact same principle applies to a general partnership (or VOF in Dutch). In effect, all income left after deduction of costs is taxed annually at the personal income tax rate (see below):

Personal Income Tax (IB)20222023
Bracket 137,10% up to €68.50836,93% up to €73.031
Bracket 249,50% from €68.50849,50% from €73.031

The amount of tax will depend on the amount of income earned

Subsidies and tax schemes for ZZP

The following tax subsidies are given to entrepreneurs running a sole proprietorship (ZZP) or general partnership:

  • Private business ownership allowance (zelfstandigenaftrek)
  • Tax relief for new companies (Startersaftrek)
  • SME profit exemption (MKB-winstvrijstelling)
  • Small businesses scheme (kleineondernemersregeling, KOR). The Kleineondernemersregeling (Small Business Scheme) is a tax-free allowance available to entrepreneurs in the Netherlands. This scheme permits small businesses to withhold 0% tax on their turnover, instead of the normal 21%.

Example: Tax calculation for ZZP

Below is an example of a tax calculation for a small ZZP/eenmanszaak. It includes the relevant deductions, tax subsidies and social security contributions.

ZZP disposable income calculation example
ZZP revenue minus expenses60.00060.000
Private business ownership allowance- 7.153
SME profit exemption- 7.399
Personal income (box 1)45.448
Tax & Premium National Insurance17.784
General tax credit-1.682
Personal income tax due11.502- 11.502
Income-related social healthcare insurance contribution-2467- 2467
Disposable annual income€ 46.031

Tax deductions ZZP / eenmanszaak

As a sole proprietor in the Netherlands, you may be eligible for several deductions that could potentially reduce your tax liability. These deductions include costs related to business operations and investments, professional fees, donations to charities, and expenses related to home-office work. Additionally, you may be able to deduct expenses such as travel costs, insurance premiums, and other business expenses. Your tax bill can be reduced by applying the following deductions.

CostsWhich part is deductible?Notes
Home workspace0% (some exceptions apply)
Food, drink, stimulantsA threshold of € 4,600 applies.

Instead of this threshold, entrepreneurs working as sole proprietor or in a partnership are allowed to deduct 80% of these costs and entrepreneurs for corporation tax (bv) 73.5%.
The item 'food' includes business lunches and dinners (including tips).

Think of 'drink' to coffee, tea, milk and soft drinks.

With 'stimulants' you should think of, among other things, cigarettes and cigars.
Representation, congresses, seminars, study trips
(including travel and accommodation costs)
Instead of this threshold, entrepreneurs working as sole proprietor or in a partnership are allowed to deduct 80% of these costs and entrepreneurs for corporation tax (bv) 73.5%.'Representation' includes the costs of receptions. Promotional gifts also generally fall under 'representation'

You may deduct a maximum of € 1,500 for the travel and accommodation costs. Was it necessary for your work to attend a conference and the like? Then this maximum does not apply.
Telephone subscription at home0%
Business phone calls at home100%
General literature
0%
Professional literature
100%
Workwear100%Work clothing is clothing that you can wear (almost) exclusively within the framework of your company. This must be evident from the appearance of the clothing, for example: a uniform or overall. Is the clothing also suitable for wearing outside of your company? The clothing must then be provided with a logo with a surface area of at least 70 cm2. The logo must refer to your company.
Clothing (no work clothes)0%
Personal care0%
Briefcases and similar100%
Equipment and instruments that do not
belong to the business assets
0%
MovingLimited
Double housingLimited
Fines0%
Company carLimited
Business costs of private carA fixed amount of € 0.19 per kilometer.
Business travel costs public transport, taxi and plane100% of the costs actually incurred
You must be able to prove that you actually incurred these costs. For example, save your train ticket. Are you traveling with an OV chip card? Then make a print out of your journeys.
Vessels for representative purposes
0%

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