Characteristics of the Dutch Professional Partnership
In the context of the Dutch law, the “maatschap” or professional partnership is different from the other forms of partnership (general and limited) as it represents a cooperation of professionals, e.g. accountants, physicians, lawyers, dentists or accountants, and its main goal is not the joint performance of business activities. The partners in this form of cooperation are called “maten”. Each “maat” participates in the partnership by contributing personal assets, effort and/or capital. The aim of the cooperation is sharing both the earned income and the incurred expenses.
Establishing a Professional Partnership in the Netherlands
For the establishment of professional partnerships, the law does not require the conclusion of a contract between the partners. However, it is in the partners’ best interests to draft an agreement. The partnership agreement can include provisions related to:
- the contributions made by each partner;
- the profit distribution proportionally to the contributions (it is not possible to transfer all profits to a single partner);
- the distribution of powers: all partners can act as managers unless agreed otherwise. Since July, 2008, professional partnerships need to be listed in the Commercial Registry. This requirement is not relevant to internally acting partnerships, e.g. where expenditures are pooled together.
Authorized partners can sign contracts binding the whole partnership. Each of the partners may be held equally responsible. Generally, if a partner acts beyond his authority, the remaining partners are not liable for his actions. Only the responsible partner is held liable. Professional partnerships do not have a capital that is separate from the partners’ personal assets. Creditors with claims towards the partnership may seek recovery of a proportionate part from each partner; such creditors are not ranked above ones with claims on the personal assets of any partner. Married professional partners are in the same position as general partners in VOFs or CVs. It is in their interest to conclude pre- or postnuptial agreements. Read more on Dutch bankruptcy law.
Social security and tax
Each partner is liable for income tax with respect to his/her share of the profit. If a partner is considered an entrepreneur by the Tax Service, then he/she can receive allowances for entrepreneurship, investment and retirement with deferred taxes. With respect to social security payments the rules for partners – entrepreneurs are the same as the ones for owners of sole proprietorships.
In case you would like to read on the Dutch general partnership click here.