In order to pay taxes in the Netherlands, both individuals and companies must file tax declarations in order to have the amounts due calculated. There are several differences between the tax returns that need to be filed by natural persons and legal entities, but these differences also appear when it comes to the fiscal residency of taxpayers.
One of the most important aspects to consider when filling out a tax declaration in the Netherlands is for the information submitted to be correct in order to have an accurate calculation of levies to pay.
Tax declaration filing requirements in the Netherlands
The tax declarations that need to be filed with the Dutch authorities depend on the following aspects:
whether the taxpayer is a natural person or a company (different forms are available for each category);
whether the taxpayer is a Dutch resident or a non-resident (there are various requirements for each category);
whether the taxpayer benefits from tax deductions or exemptions from certain levies;
whether the taxpayer is subject to special conditions, such as change in the employment status, moving out of the country during the year in course, etc.
It is common for Dutch taxpayers to receive notifications on filing their tax declarations, therefore if you have relocated to the Netherlands and have received such an invitation this is not out of the ordinary.
If you want to open a company in the Netherlands, you will need to consider specific aspects when it comes to filing tax declarations for you as a shareholder and for the business.
Tax declaration filings for natural persons in the Netherlands
Natural persons residing in the Netherlands must pay their taxes in accordance with the Box taxation system which is made of 3 boxes. These must be checked in accordance with the type of income generated and based on which the declarations to be filed will be indicated.
It is possible for the tax returns to be filed electronically, however, the taxpayer needs to obtain a digital identification code, which is why many Dutch citizens and residents have their own tax advisors who help them.
- the P Form which must be filed by Dutch employees who have lived in the country for a whole fiscal year;
- the M form which must be filed by those who have lived in the country partially throughout a fiscal year;
- the C Form which needs to be filed by non-residents who earn money in the Netherlands;
- the W Form which must be filed by self-employed individuals residing in the Netherlands;
- the E Declaration which is a simplified form of the P Declaration.
In unfortunate cases where a person dies during a fiscal year, close relatives (the surviving spouse or children) must file the F Form on behalf of the deceased.
Should you need advice on the tax declarations to file in the Netherlands with the Tax and Customs Authorities, you can ask our local consultants.
Tax declarations for companies in the Netherlands
The rules for filing tax declarations for Dutch companies are different from those applicable to natural persons, as the first type of taxpayer can have a different financial year than the fiscal year. Also, special tax rules can apply to companies.
Dutch companies usually receive provisional assessments based on which they will pay their taxes. There are three ways in which a business tax declaration can be filed in the Netherlands:
- online, based on the access code provided by the Trade Register;
- through the special software for commercial entities;
- through a tax advisors or accounting firm working for the company.
We can provide tailored accounting services for your Dutch company. We also invite you to watch our video:
What to consider when filing tax declarations in the Netherlands?
Dutch tax declarations can be filed on an annual basis, but also on shorter timeframes, such is the case of VAT returns. Also, the late filing of tax returns can result in penalties imposed both to companies and individuals.
Other aspects to consider are:
- the tax year that starts on January 1st and ends on December 31st;
- the declarations for a year must be filed by between March 1st and April 30th of the following year;
- the minimum taxable amount of money in the Netherlands is 45 euros;
- foreign citizens who make more than 90% of their income in the Netherlands can benefit from substantial tax allowances, credits or exemptions.
For more information on how to file a tax declaration in the Netherlands, please contact us.