Foreign businesses exporting goods from outside the EU to an EU customer via one of the Dutch ports are subject to the Dutch VAT regime.
Business owners who do not reside in the Netherlands, or whose business is not based or does not have a permanent establishment in The Netherlands can appoint a Dutch tax representative to meet the administrative obligations of the Dutch VAT rules.
Tax representation has been enshrined in the law since 1992. VAT-EX B.V. (“VAT-EX or IVA-EX”) can fulfill this role. In the situations mentioned below foreign traders are obliged to appoint a Dutch tax representative.
A tax representative of a foreign business is responsible for meeting that businesses VAT obligations that arise from their sales activities via The Netherlands. In practice, the tax representative takes care of all related administrative duties for the foreign enterprise, so that it can concentrate on doing business.
Services provided by tax representative:
The advantage of appointing VAT-EX is that the foreign business:
VAT-EX provides clients the privilege to apply for and secure a one-off bank guarantee. This bank guarantee is a condition for appointing a tax representative.
The Dutch Tax & Customs Administration demands a bank guarantee whenever a foreign business appoints a tax representative. A bank guarantee is a contract in which a bank provides an unconditional guarantee to pay an amount to a beneficiary as soon as it claims payment. The amount of the bank guarantee is based on the average VAT liability per month and/or quarter. Foreign businesses are required to provide a bank guarantee for the period it is registered for VAT purposes in The Netherlands and for five years after the foreign business has ceased using a Dutch tax representative.
VAT-EX assists businesses with arranging the bank guarantee at the Dutch Tax & Customs Administration.
As of 2014 the minimum amount of the bank guarantee is € 5,000 and the maximum amount is
€ 100,000 or € 500,000. The amount of € 100,000 is applicable for bulk goods/bulk material, semi-finished products and production resources. The amount of € 500,000 is applicable for consumer goods.
Tax representatives in The Netherlands are required to be licensed by the Dutch Tax & Customs Administration. There are two types of licenses:
VAT-EX provides its services on the basis of a general license.
For specific VAT/IVA advisory services we work with reputable tax firms in The Netherlands. Obviously, we will be happy to work with your VAT advisory firm of preference.