Which VAT rate should I charge?
Short answer
The Netherlands has three VAT (btw) rates: 21% (the standard rate), 9% (including food, books, hairdressers and certain work on homes older than two years) and 0% (mainly exports and supplies to businesses in other EU countries). Some services are exempt, such as healthcare by BIG-registered professionals and certain education.
Updated on · Reviewed by the tax advisers at Boekhoudvriend
The rate depends on what you supply, not on who you are. A hairdresser charges 9% for a haircut, but 21% for selling shampoo and other care products. If you supply several things, a different rate may apply to each invoice line.
Common rates by sector
- 21%: most business services, such as consultancy, IT, marketing, construction and repairs to commercial premises
- 9%: food and non-alcoholic drinks, books, hairdressers, bicycle repairs and painting or plastering homes older than two years (labour only)
- 0%: exports of goods outside the EU and supplies to VAT-registered businesses in other EU countries
- Exempt: healthcare by BIG-registered professionals, recognised education and certain financial services
Exempt is not the same as 0%
At 0%, you still file VAT returns and reclaim the VAT on your costs. With an exemption, you don't charge VAT, but you also cannot deduct the VAT on your costs. That makes a big difference to your costs and your bookkeeping.
Sources
This answer is general information, not personal advice. Your own situation may work out differently, so feel free to ask our team.