VAT returns for your BV: the complete guide

The VAT return is the one filing that comes back every quarter and actually moves cash. This is how it works for a startup BV: filing periods, deadlines, what goes in the boxes, EU customers, and the errors that cost the most.

When your BV is liable for VAT

As soon as your BV supplies goods or services in the Netherlands, you are in principle a VAT entrepreneur. You get a VAT identification number, you charge VAT on your sales and you deduct the VAT on your business costs. The balance of the two is what you remit or reclaim. In the early phase of a startup that balance is often negative: you buy more than you sell, so VAT comes back to you.

That makes the VAT return something other than a formality for a startup. It is the return that produces or costs cash, and the only one that comes back every quarter.

Your filing period: quarterly, monthly or annually

Most entrepreneurs file quarterly. You can ask the Belastingdienst for a different period, and for a startup that is worth considering: if you structurally reclaim VAT, filing monthly means receiving that money every month instead of every quarter. With a negative cash position that difference is noticeable.

If you remit every quarter instead, quarterly filing is calmer and keeps the money in your business longer. Which of the two fits you depends on your cash flow, not on a general rule.

The deadlines

The return and the payment have to be in by the last day of the month following the period. For quarterly filing that means:

• First quarter: by 30 April.
• Second quarter: by 31 July.
• Third quarter: by 31 October.
• Fourth quarter: by 31 January of the following year.

Two things go wrong here regularly. A quarter without revenue still needs a return, a nil return, because the obligation to file does not depend on your turnover. And the payment counts as heavily as the return: filing on time and paying late still earns you a penalty.

What the return contains

The return is a set of boxes that together determine your balance. Broadly: your turnover and the VAT due on it, split by rate, plus the boxes for supplies abroad. Below that the input VAT, meaning the VAT on your purchases. The difference is what you pay or reclaim.

Two boxes matter especially for a startup: the one for supplies and services to other EU countries, and the one for VAT that has been shifted to you. That last case is more common than founders expect, for instance with foreign software vendors.

Foreign customers and the ICP declaration

If you supply a business customer in another EU country with a valid VAT number, the VAT shifts to that customer. You invoice without VAT, stating that VAT is shifted and showing your customer VAT number. You also report those same supplies in the intra-Community transactions declaration, the ICP, and its total has to equal what you put in the corresponding box of your VAT return.

The ICP period is in principle monthly, due by the last day of the following month. Quarterly is allowed if your intra-Community supplies of goods stayed under 50,000 euros in that quarter and in each of the four preceding quarters. If you supply services rather than goods, or sell to consumers abroad, different rules apply. That is exactly the kind of question for a tax specialist rather than your bookkeeper.

What startups get wrong here

• Skipping a nil return in a quarter without revenue.
• Reclaiming VAT on costs that are partly or wholly private.
• Shifting VAT without checking the customer VAT number and putting it on the invoice.
• Booking a payment-provider payout as revenue instead of the underlying invoices, so the VAT amount does not add up.
• Not declaring foreign subscriptions where VAT has been shifted to you, even though you can deduct it again in the same return.

An error in an earlier return

If you discover an earlier return was wrong, you correct it with a suppletie. Do it as soon as you know: where you declared too little, tax interest can be added, and that amount grows the longer you wait. A correction to the EU supplies box also needs a separate explanation.

What we do here

We handle your VAT return and your ICP declaration, process shifted VAT in your administration and guard the periods, so no period is skipped. What we do not do is give tax advice: whether a supply qualifies for shifting, which rate applies or how to structure international activity is a question for a tax specialist. We say so when your question belongs there.

In short

• A BV that supplies is a VAT entrepreneur: VAT on turnover, deduction on costs, balance remitted or reclaimed.
• The default is quarterly filing, due the last day of the month after the quarter. Monthly can help if you structurally reclaim.
• A quarter without revenue still needs a nil return, and paying late costs as much as filing late.
• EU supplies to business customers go out with shifted VAT, plus an ICP declaration that must tie to your return.
• You correct an error with a suppletie, and waiting only adds tax interest.