Value Added Tax (VAT) or BTW
Value added tax (VAT) The VAT is probably the most common tax among entrepreneurs. You’re more likely considered to be an entrepreneur for the VAT than for the Income tax. If you enter the market and become a competitors ofother entrepreneurs, you are sooner forced to charge VAT to your customers. So there’s a possibility that you’re considered to be an entrepreneur for the VAT and at the same time not for the Income tax. The frequency with which you should report tax returns is determined in the allocation of your VAT-number. This can be every month, every quarter or every year. The frequency depends on your turnover, but if you prefer a different frequency, we can submit a request to the Belastingdienst. At the end of the year, we can make an additional assessment (suppletieaangifte) if necessary. This is seen as a kind of correction compared to earlier tax assessments. You don’t have to pay right away if there’s made a additional assessment. You’ll get a tax assessment from the Belastingdienst and then you’ll pay the tax. As an entrepreneur, you have to charge a value added tax of 21%, 9%, or 0%, depending on the services/supplies you deliver. It is also possible that you supply exempted services. Your invoices need to meet the statutory requirements. If not, this can lead to problems for both your company and the client. Usually there also rests VAT on your own purchases. These are deductible, but there are some expectations. For example, the VAT you pay on your lunch and dinner receipts are not deductible. If you supply exempted services then it is not possible to deduct the tax. If you supply both exempted and taxable services then the ratio between these performances determines the level of deductibility. Not all subsidies are exempt from VAT. A project subsidy may be charged with VAT, depending on the specific subsidy conditions in the subsidy agreement. The tax for the taxable subsidies should be paid by the recipient. So it is possible that your right on the kleine ondernemersregeling will expire if the VAT exceeds the maximum. VAT Return From January 1, 2005, all tax returns need to be done electronically. For calculating the amounts that need to be paid or recovered, all receipts and invoices for that specific return period are taken into account. It is irrelevant whether the bill has been paid. It is therefore recommended that if you do not have much financial space, you’ll be aware with sending out invoices because you need to pay the VAT in advance. Based on the tax returns you pay the amount indicated. If you need an amount refunded, you will receive this after some time from the Belastingdienst. If the report of the tax inspector is distinctive, you may object and appeal against his decision within the specified time. If we regulate your tax return, we’ll send you an e-mail along with the declaration for your own administration.