Valid residence permit
If you want to work as a freelancer you need to have a valid residence permit that allows you to work in the Netherlands. Check if you need to apply for a Dutch residence permit (MVV) or work permit (TWV). For more information on Visas & Permits, read our comprehensive guide.
Chamber of Commerce (Kamer van Koophandel)
When you have a residence permit, you should register yourself at the Chamber of Commerce. You will have to choose a business name. Once registered you will automatically receive a VAT number from the Dutch tax authorities. Freelancing is not a legal form in the Netherlands, therefore many people who are self-employed choose the business form of sole trader.
Declaration of Independent Contractor Status (VAR)
Please be note that presumably as of 1 April 2016 the VAR declaration will be replaced by model agreements. You will have a general and individual model agreements, as well as agreements per sector and profession. The purpose of these agreements will remain the same: to determine who has to pay payroll taxes.
As a ZZP’er you can apply for a VAR (Verklaring arbeidsrelatie) which defines whether you are a freelancer or an employee of the company that you do business with. It is not mandatory to apply for one, however clients may require a VAR statement before they start working with you to avoid any confusion and additional costs. If you are considered an employee, then the company hiring you will be responsible for paying income tax and social insurance contributions on your behalf. If you are considered self-employed, your clients do not have to deduct premiums from your freelance payments.
You apply for a VAR from the Dutch tax authorities. Your relationship with your clients (or employers, as the case may be) will define which VAR you receive. The tax authorities will assess your situation. There are four different types of VAR:
- Declaration of Independent Contractor Status - Income from employment (VAR-loon)
- Declaration of Independent Contractor Status - Results from other activities (VAR-ROW)
- Declaration of Independent Contractor Status - Profits from business activities (VAR-WUO)
- Declaration of Independent Contractor Status - Income from activities at the company's risk and expense (VAR-DGA)
A VAR statement is only valid for one year and applying is free of charge.
Taxes and administration
Like business owners, freelancers are obliged to keep legal records of their administration. Freelancers have to pay turnover tax and income tax.
Most freelancers are required to charge VAT – 21% or 6%, depending on the service. Also, you will be required to fill in a VAT return every quarter. This can be very complex, so it is advisable to hire an accountant.
There are tax facilities and subsidies especially for self-employed professionals to promote entrepreneurship in the Netherlands. For more information on subsidies, please visit the governmental website.
For more detailed information on taxes and administration please visit the Dutch tax authorities website.
As a freelancer you have more risks than employees, like not having any income when unable to work due to illness or accident, or being held responsible for mistakes or damage caused.
When you work as a freelancer you cannot claim social benefits under the Sickness Benefits Act, the Work and Income Act or the Unemployment Insurance Act. Therefore, it is advisable to take out insurance to cover these risks.
You do, however, qualify for the following national insurance schemes: General Old Age Pensions Act, Surviving Dependants Act, Exceptional Medical Expenses Act and General Child Benefit Act.
Every inhabitant of the Netherlands aged over 65 (soon to be age 67) has an entitlement to receiving AOW (Algemene Ouderdomswet), a national old age pension. This is a basic pension, which may not be sufficient to live on. It is, therefore recommended that you build up a supplementary pension through a pension insurance scheme. You could then take out an annuity policy or another type of savings scheme.
Every resident of the Netherlands has to take out basic health insurance. Everyone pays a premium directly to the health insurance company of your choice. Extra insurance is needed to cover various risks. Apart from the nominal premium to be paid to the insurance company, the Tax Administration collects another income-related contribution.
For more detailed information please go to this website.