Starting a business in the Netherlands: A guide for expats
Whether you are pursuing a lifelong passion or seizing a market opportunity, starting a business in the Netherlands involves meeting a range of legal and administrative requirements. For expats, this process can be particularly challenging due to unfamiliarity with Dutch laws and regulatory procedures.
At Lexquire, our legal experts regularly assist entrepreneurs with setting up and structuring their businesses in the Netherlands. This article outlines the main legal and practical steps involved in starting a business as an expat; beginning with personal visa requirements, followed by choosing a suitable business structure and name, securing a business address, registering with the KVK, and concluding with any obligations that may apply after registration.
1. Ensure you have the necessary residence permit
Before you can begin the process of establishing a business in the Netherlands as an expat, you must ensure that you have the appropriate residence permit that authorises you to work independently.
If you are a citizen of an EU or EEA country, or Switzerland, you have the right to live and work freely in the Netherlands in accordance with EU law, and you do not need to apply for a residence permit. However, if you are a non-EU, non-EEA, or non-Swiss citizen, you must apply for a residence permit that allows you to live and work in the Netherlands.
For non-EU/EEA/Swiss citizens wishing to start their own business, the most relevant residence permits include:
1.1. Residence permit for self-employed entrepreneurs
To qualify for this permit, the Dutch Immigration and Naturalisation Service (IND) requires that you have a business idea that serves an essential Dutch interest. The Netherlands Enterprise Agency (RVO) will assess the product or service you intend to offer using a point-based system, awarding points based on your experience, business plan, and the innovative or economic value your business brings to the Netherlands.
If the RVO determines that your business is of essential interest to the Netherlands and you have obtained the minimum required points, your application will be approved.
1.2. Dutch startup visa
This one-year residence permit is intended for innovative entrepreneurs who wish to launch their own startup in the Netherlands. To qualify for this permit, you must collaborate with a recognised Dutch startup facilitator, who will provide you with guidance and support throughout the year. Both you and your facilitator must be registered with the Dutch Chamber of Commerce (KVK).
Additionally, you must submit a detailed and innovative business plan that demonstrates how your startup will evolve into a fully functional business.
1.3. Highly skilled migrant visa (HSM visa)
While primarily intended for highly skilled employees working for recognised sponsors, the HSM visa can also offer a pathway for individuals to relocate to the Netherlands and start their own business alongside their primary employment. This route provides the advantage of financial stability during the initial startup phase.
However, you must continue to meet all the requirements of the HSM scheme, including maintaining your employment with the recognised sponsor and ensuring that any entrepreneurial activity does not conflict with your visa conditions or employment obligations.
2. Choose a suitable business structure
Selecting an appropriate business structure is an important decision when starting a business in the Netherlands. It is significant to understand the different types of business entities available, as your choice will affect liability, taxation, and administrative obligations. Below are some of the most common types of Dutch business structures:
2.1. Besloten vennootschap (private limited liability company)
A besloten vennootschap is regarded as a separate legal entity, meaning it has its own legal personality distinct from its shareholders. Ownership is divided into shares, and while shareholders hold the decision-making authority, the day-to-day management is carried out by the company’s directors. A key advantage of this business structure is the limited liability: the company itself is liable for its debts, thereby protecting the personal assets of its shareholders.
Incorporating a besloten vennootschap requires the involvement of a Dutch notary, who will draft and execute the notarial deed of incorporation.
2.2. Vennootschap onder firma (partnership)
A Vennootschap onder firma is established by two or more business partners, each of whom contributes to the business, whether in the form of labour, capital, assets, or other resources. A key disadvantage of this business structure is that all partners are jointly and severally liable for the debts and obligations of the business.
While it is not legally required to have a written agreement in place to register a Vennootschap onder firma, it is strongly recommended to execute a formal partnership agreement. This document helps define each partner’s rights, responsibilities, and profit-sharing arrangements, and can help prevent disputes in the future.
2.3. Eenmanzaak (sole proprietorship)
An Eenmanzaak is operated by a single individual who assumes full ownership of the business. They are entitled to all the benefits but also bear unlimited personal liability for all the business’ debts. One significant advantage of this business structure is that the tax rates can be lower compared to other business entities, and the registration process is relatively straightforward.
There are various other business structures available in the Netherlands. For tailored advice on which structure would best suit your company’s specific needs, consult one of our legal experts.
3. Choosing a business name
After making the key decisions regarding your business structure and operations, it is time to choose a name for your business. This process can be either exciting or challenging, as it requires creativity and strategic thinking. Regardless of the approach you take, it is essential to ensure that the name you choose complies with the Trade Names Act.
For example, you may not select a name that is misleading to consumers – such as one that creates a false impression about the size, nature, or scope of your business. Furthermore, the use of professional titles is restricted if you are not a qualified professional (e.g. accountant, doctor, etc.). Adhering to these rules helps protect consumers and maintains fair competition in the marketplace. For further details and to ensure compliance, we recommend consulting the KVK’s official guidance on choosing a business name.
4. Securing a business address
To register your business with the KVK, you must have a physical address in the Netherlands that serves as a dedicated location for your business operations. This address can be a traditional office space, a home office, or a virtual office that provides a professional business address along with mail handling services.
5. Registering your business with the KVK
Once your business structure, name, and address are finalised, you must register your business with the KVK. Although not legally required for all structures, engaging the services of a notary is strongly recommended to ensure your business is registered accurately and within your desired timeframe. Our experienced notaries are available to guide you through the process and handle the formalities on your behalf.
However, if you choose to register your business independently, you will need to complete the official registration form, available on the KVK website, and make an appointment at one of their offices. During your appointment, you will be required to present several documents, including your passport, the completed registration form, a lease agreement or proof of business address, the Articles of Association and Memorandum of Association (if applicable), and a certificate of incumbency indicating the appointed directors.
If all the documentation is in order, you will be required to pay a one-time registration fee. Upon completion, your business will be officially registered and assigned a business number (KVK nummer).
6. Post-registration obligations
Congratulations – your business is now officially registered. However, your administrative responsibilities are not yet complete. One of the next essential steps is to open a Dutch business bank account. Banks typically require documents such as your passport, proof of address in the Netherlands, your KVK number, the Articles of Association, and a Ultimate Beneficial Owner (UBO) register.
Additionally, after your business is registered with the KVK, you should receive your VAT numbers by post within approximately 10 days. Fortunately, you do not need to apply for this separately, as the KVK automatically forwards your registration details to the Dutch Tax Administration.
With these formalities complete, you can finally open the doors to your business. However, it is important to remember that operating a business in the Netherlands requires full compliance with applicable laws and regulations. Additionally, once you begin hiring employees, you must ensure adherence to Dutch labour laws. Read our article on What you need to know about Dutch Employment Contracts to ensure that your future employment contracts are legally binding.
Starting a business in the Netherlands presents excellent opportunities for expats but also involves various legal and administrative challenges. At LexQuire, we are here to guiding you through every step of the process. Our legal experts are ready to advise you on all relevant laws and regulations and assist with any employee-related matters.
