Since 2003, Healy Consultants Group has assisted our Clients with starting a business in the Netherlands. Our services include i) Netherlands business registration ii) government license registration iii) business bank account opening iv) employee recruitment v) visa strategies and vi) office rental solutions.

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Netherlands business setup summary

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• Advantages and disadvantages

  Advantages of Netherlands company registration

  

  1. It is possible to register a company in the Netherlands within 4 weeks with 1 director and 1 shareholder, who can be of any nationality. There is no minimum share capital requirement for a limited liability company in the Netherlands and our Clients do not need to travel to complete the engagement;
  2. Our Clients willing to expand in Europe often choose to register their company in the Netherlands because:
     • Dutch businesses enjoy little government interference on their daily operations. The Netherlands is indeed ranked as the 24^th easiest country to do business amongst developed countries, according to the World Bank;
     • Our Clients find paying taxes is simple in Holland because i) everything is online and ii) all annual tax requirements can be settled within 5 days per year;
     • Running an online business in Holland is ideal, as the country has an excellent broadband connectivity and is the 20^th best country in the world for fixed broadband internet connection;
     • Corruption is almost non-existent in Holland as it is the 8^th least corrupt country in the world. Additionally, our Clients’ property is well protected, as Holland is the 10^th best country in the world according to the International Property Rights Index;
     • Firms do not require an annual audit if they have i) less than €8.80 million turnover and ii) less than 50 employees;
     • Dutch resident businesses benefit from highly skilled employees with i) a 99% literacy rate ii) 1^st in the EF English Proficiency Index ranking iii) a 94% computer literacy rate and iv) a 64% rate for high school completion.
  3. Our Clients who choose to start and run a company in the Netherlands also benefit from the following tax advantages:
     • Our Clients remitting loans repayments to non-resident companies are exempted from withholding tax;
     • Dividends and capital gains remitted to a resident parent company are tax exempt, if less than 50% of the assets are passive. Our Clients will also benefit from reduced withholding tax rates of up to 0%, if the funds are remitted to a parent company incorporated in one of the 100 countries that have signed a double tax agreement with Holland;
     • Netherlands resident companies can carry forward their business losses indefinitely, for up to €200,000 annually plus 25% of subsequent profits exceeding that amount;
     • Our Clients firms can use their own currency when doing their bookkeeping and other financial requirements.
  4. Netherlands provides excellent IP incentives to its multinational companies:
     • A subsidy of 18% to 64% is granted on employment costs given that those R&D activities are performed that are promoted by the state;
     • Under the Research and Development Deduction scheme, an additional deduction of 40% of all expenditure is applicable on all those R&D-based capital expenses that hold an R&D certificate;
     • Under the Innovation Box tax regime, a tax rate of 9% is levied on innovative assets instead of the standard tax rate of 25.8%.

  Disadvantages of Netherlands company registration

  1. Starting a business in the Netherlands is expensive because:
     • Taxation on businesses in the Netherlands is punitive, with an effective tax rate of 52% including i) a corporate tax of 25.8% ii) VAT on sales at 21% and iii) employer’s social security contribution of 31% on salaries;
     • Labor is expensive in Holland as the minimum wage is €1,490 per month;
     • The annual rent in Amsterdam is high at €370 per square meter;
     • Our Clients find it tedious to get a construction permit as i) a fee of €18,608 is imposed and ii) it takes 98 days to process;
     • Foreign entrepreneurs will need to translate official company registration documents as they are mainly in Dutch;
     • 60% of the land surface in the Netherlands is prone to flooding, consequently, the risk of flooding may incur additional business costs.
  2. Our Clients feel restricted by the labor laws in Holland because:
     • Terminating an employee’s contract in the Netherlands is difficult. Employers need to i) request permission from the Employee insurance agency (UWV) and ii) give a 9 week notice period;
     • Our Clients find it costly to dismiss an employee, as they will be required to provide him with a severance pay of at least 15 days per year worked in the company;
     • Working on Sundays is prohibited, and employees are entitled to 4 weeks of paid leave per year.
  3. Investors are reluctant to set up a joint-venture company in Holland because:
     • Our Clients will have to disclose i) management reports and ii) financial statements, available for public viewing at the Netherlands Trade Register;
     • Investors may face problems with minority shareholders, as they may i) request to a Court to nullify a transaction if it was carried out in an oppressive manner and ii) request an inspector to investigate transactions and file subpoenas, if they hold at least 10% of share the shares in the company.
  4. The labour market of Netherlands is relatively weak, based mainly on gender inequalities and discrimination against immigrants. Employers do not get much flexibility in determining the wage of the employees. As a result, wages are relatively high, with a statutory minimum wage of US$22,336 p.a.

• Best uses of a Netherlands company

  1. The Netherlands is well positioned for import and export businesses because:
     • Holland is well connected to the rest of Europe by ground because i) highways in the Netherlands have no tolls and ii) 95% of Europe can be reached by truck within 24 hours;
     • The Netherlands has world class shipping facilities, with the port of Rotterdam being the 3rd busiest port in the world;
     • Air transport is also readily available in the Netherlands with i) 28 major airports operating more than 70 international air freight companies and ii) Europe’s 4^th busiest airport Amsterdam Schiphol;
     • Goods can be transported easily due to Holland’s ideal geography as i) it is located in the center of Europe ii) low gradient land allows for great ground connections and iii) the abundance of rivers provide well-connected inland waterways;
     • For the reasons above, Netherlands boasts the 3^rd best infrastructure in the world.
  2. A Netherlands shipping company enjoys these benefits:
     • Meeting delivery deadlines is easy, as the Netherlands boasts the 4^th most efficient customs in the world;
     • Our Client running a shipping company will know with certainty the amount of tax payable on their sales, thanks to a fixed tax rate on the weight of shipped goods;
     • Netherlands-based shipping companies benefit from competitive labor costs compared to their EU competitors, as a 40% wage tax reduction applies to their employees living in the Netherlands.
  3. The Netherlands is a gateway for IT, telecommunication and digital companies in Europe due to the reasons below:
     • 99% of the households have access to broadband services, making the Netherlands a leading country with the highest broadband penetration per capita in the entire world;
     • The country also has one of the fastest average broadband speeds in the world;
     • Starting a business in Amsterdam gives companies an exposure to the leading digital hub due to the presence of the Amsterdam Internet Exchange (AMS-IX) which delivers world-class interconnection services to the businesses located in Netherlands as well as in the rest of the world.