How to start a business in the Netherlands

The Netherlands is one of the most appealing states in the world from an investment point of view. While some businessmen find its geographical location useful, others find its taxation system attractive, while others like to take advantage of the types of companies they can open there and the industries they can invest in.

No matter the reason why investors choose the Netherlands, opening a company there implies several steps which are usually the same no matter the industry.

Business planning

One cannot start a business in the Netherlands without having a plan and a well-established budget. The budget should include the business start-up and licensing costs and the maintenance costs. It wouldn’t hurt to also make an estimation of the profits for the next two or three years, just in case one will need to make adjustments along the way.

Choosing the legal entity

So, the budget and business plan are set; the next step will be to choose the type of company the investors will need to register in order to operate. From this point of view, the Netherlands is very generous, as businessmen can choose between partnerships, private and public companies. Nevertheless, the private limited liability company, shortly known as the Dutch BV, is preferred by both local and foreign enterprisers.

Preparing the company registration documents

The good news is that the registration of a Dutch company does not imply extensive paperwork. Foreigners will need their passports, while locals will only need their IDs in order to get started. Then, the company’s statutory documents – Articles of Association – must be drafted and notarized. The next step will imply reserving the company name, but this is done electronically.

The company will also need a bank account, so opening it before the actual registration process takes place is recommended.

Share capital requirements

This is an important subject when starting a business in the Netherlands. The share capital does not relate to the legal requirements only, but it implies the overall amount of money necessary to start operating. From a legal point of view, in the case of a Dutch BV, the minimum amount of money needed is 1 euro, but practically the company will need much more to be able to sustain its operations. This takes us to the first step where the budget is essential.

Accounting and licensing of the Dutch company

Once the company is registered with the Chamber of Commerce it will need to register with the tax authorities, too. These will issue the new business a tax ID number and a VAT number. Hiring an accountant to handle the bookkeeping is the next step.

At last, obtaining the necessary licenses to finally getting started is mandatory. The licenses which must be obtained will first depend on the activities of the company. There is also a one-in-all permit issued by the municipality, however there are cases where special authorizations are needed. The business owner will need to pay attention to these aspects.

Taken step-by-step, starting a company in the Netherlands could look like a lengthy and complicated procedure, but in fact all of these steps can be completed in a short period of time, except for the licensing phase which depends on the authorities which issue the approvals.

Adam Torkildson