VAT in the Netherlands: How It Works (21%, 9%, 0%)

Updated on 17 June 2025

Are you a business owner who is based in a country other than the Netherlands? Do you supply services or goods to the Netherlands? If so, you might be classed as a foreign entrepreneur in terms of VAT. You may need to file a turnover tax return in the Netherlands and you might also need to pay VAT in the Netherlands. ICS can provide you with more information about the latest VAT regulations in the Netherlands as well as calculating VAT, filing VAT returns, paying VAT, and how to deduct or claim a VAT refund.

What is VAT in the Netherlands?
In the Netherlands, Value Added Tax (VAT) is charged on most goods and services. The standard VAT rate is 21%. A reduced rate of 9% applies to essentials like food, medicine, and books, while a 0% rate applies to international trade and specific exemptions.

Example of VAT Calculation

To illustrate how VAT is calculated, if a product has a price excluding VAT of €100, the VAT added at the standard 21% rate would be €21, bringing the total price including VAT to €121. If the product is subject to the reduced VAT rate of 9%, the VAT added would be €9, making the total price including VAT €109.

All businesses must register for VAT if their turnover exceeds the applicable threshold. In the Netherlands, the VAT registration threshold for small businesses is €20,000 in annual turnover. If your business turnover exceeds this amount, you are required to register for VAT with the Dutch Tax Authority (Belastingdienst).

VAT registration for foreign business owners

In certain cases, a foreign entrepreneur who has to cope with Dutch VAT can opt to register for VAT with the Dutch tax authorities.

This is a possibility, for example, if a businessman does not want to offer bank guarantees, as is a requirement for General Tax Representation. Another benefit is the fact that the latter is more straightforward to arrange than a General Tax Representation permit.

There are certain disadvantages for a non-Dutch national to register for Dutch VAT. This is because foreign entrepreneurs are not entitled to a permit under Article 23 (VAT reverse charge) because it is only for people who live in the Netherlands as an entrepreneur or are established there. Since the VAT cannot be transferred it is a given that it must always be paid.

VAT on foreign receipts

First of all: all expenses must be made for your business can be deducted. If so: you can deduct the costs.

For VAT: on hotels outside the NL, VAT of the country of the hotel will be applicable.
So for example you stay in a hotel in Germany, German VAT will be applicable. You can’t deduct this German VAT in your Dutch VAT declaration. There are possibilities to ask this VAT back with the German tax authorities, but a threshold applies and it is a time-consuming process.

This is therefore only interesting when it concerns large amounts. The costs of the hotel can of course be deducted from the Dutch profit. For airline tickets no VAT is applicable. You can deduct the costs of the profit (if it is a trip for business).

It would good to discuss with your suppliers when it is possible that suppliers do not charge you VAT. If you have an active VAT number in the Netherlands, they can verify that with the EU Vies register. And see that they are allowed to invoice you at 0% reversed charge. For other countries outside the EU, other rules apply.

Domestic VAT transactions vs. Intra-community supplies

Domestic VAT transactions refer to sales of goods and services within the Netherlands and are subject to the standard VAT rates. In contrast, intra-community supplies are transactions between businesses located in different EU countries. These supplies are generally zero-rated for VAT purposes, provided that the buyer is VAT-registered in another EU country.

How to apply for a Dutch VAT number

When foreign entrepreneurs want to apply for a Dutch VAT number, they only have to submit a few documents, but they must first complete an application form from the tax authorities. As soon as the Dutch VAT number is supplied, a foreign entrepreneur is legally able to trade in any country within the European Union.

Adequate VAT administration is needed for this and this is where a company such as ICS can provide valuable assistance. An international company can opt to have this administration undertaken by an administration office based in the Netherlands. The Tax and Customs Administration carries out strict checks, especially when reclaiming VAT so it is extremely important to ensure that the correct paperwork is always in order. If the administration is outsourced to an accounting office, this office is not responsible for the activities with which the foreign company is involved in the Netherlands.

Do you want assistance with applying for a VAT Registration for foreign entrepreneurs? The experienced VAT specialists at ICS will help you on your way.

FAQ's

What is the VAT rate in the Netherlands?

The standard VAT rate in the Netherlands is 21%. This applies to most goods and services. There are also reduced VAT rates for specific categories of products and services.

When do the 9% and 0% VAT rates apply in the Netherlands?

In the Netherlands, the 9% reduced VAT rate applies to essential goods and services such as food, medicine, books, and certain cultural activities. The 0% VAT rate applies to certain exports, international transport services, and intra-EU supplies of goods and services.

Do foreign companies need to register for Dutch VAT?

Yes, foreign companies that supply goods or services in the Netherlands or to Dutch customers may be required to register for Dutch VAT. If a foreign company exceeds the VAT threshold or makes taxable supplies, it must comply with Dutch VAT laws and register with the Dutch Tax Authority (Belastingdienst).

What is the VAT threshold in the Netherlands?

The VAT threshold in the Netherlands refers to the sales limit for small businesses. If your business generates less than €20,000 in turnover annually, you may qualify for the small business exemption (kleineondernemersregeling). This allows you to avoid charging VAT on your invoices, but you also cannot deduct VAT on your expenses.