EU Small Business Scheme (EU SME Scheme) for entrepreneurs outside the Netherlands

Are you an entrepreneur based in the EU but outside the Netherlands, and do you conduct business within the EU? If your total turnover does not exceed € 100,000 in a calendar year, you can participate in the EU SME Scheme starting 1 January 2025.

This scheme provides a VAT exemption for entrepreneurs operating within the EU. With the EU SME Scheme, you can obtain a VAT exemption from 1 January for 1 or more EU countries where you conduct business. For example, if you participate in the EU SME Scheme in France, the Netherlands, and Italy, you will receive a VAT exemption in all 3 countries. However, you can also choose to participate in the EU SME Scheme in just 1 country, such as the Netherlands. In that case, you will only receive a VAT exemption in the Netherlands.

If you participate in the EU SME Scheme in the Netherlands, you do not charge VAT to your customers in the Netherlands. You also cannot reclaim VAT in the Netherlands, including for costs incurred for your supplies. Additionally, you do not pay VAT to us. This means you are not required to file a VAT return here.

However, you are required to submit a quarterly turnover report to the tax authorities in the country where you are established. This report provides an overview of the turnover you achieved throughout the EU during the quarter.

Conditions for participation in the EU SME Scheme

Do you want to apply the EU SME Scheme in the Netherlands? Then you must meet these conditions:

1. Your business is established in another EU country, not in the Netherlands.
To participate in the EU SME Scheme, you must register with the tax authorities in the country where your business is established. If you have establishments in multiple EU countries (fixed establishments), your main office (headquarters) must be outside the Netherlands. If your business is not established in the EU, you cannot participate in the EU SME Scheme.

2. Your turnover in the Netherlands does not exceed € 20,000.
Each EU country sets its own national turnover threshold. In the Netherlands, this threshold is €20,000 per calender year. To qualify for the VAT exemption in the Netherlands, your turnover must stay below this amount. If your turnover exceeds the threshold, you can no longer apply the EU SME Scheme in the Netherlands. You must immediately deregister with the tax authorities in the country where your business is established.

3. Your total turnover in the EU does not exceed € 100,000 per calendar year.
Your turnover for both the current and previous calendar year is considered. The total turnover across the entire EU must not exceed € 100,000 in a calendar year. This includes turnover in all EU countries where you conduct business, including the Netherlands, as well as in countries where you are not participating in the EU SME Scheme. If your turnover exceeds € 100,000, you must immediately deregister from the EU SME Scheme.

Do you want to apply the EU SME Scheme in the Netherlands?

You must register with the tax authorities in the country where your business is established.

Do you no longer want to apply the EU SME Scheme in the Netherlands?

You must deregister with the tax authorities in the country where your business is established.

You must immediately deregister from the EU SME Scheme in the following situations:

• Your turnover per calender year exceeds € 20,000.
• Your total turnover across the entire EU exceeds € 100,000 in this calendar year, as well as the previous calender year.

If your turnover exceeds these turnover thresholds, you can no longer apply the EU SME Scheme in the Netherlands. You must deregister immediately.

Did you deregister from the EU SME Scheme? Please note that from that time, a period begins in which you can't participate in the EU-SME Scheme. This period includes the year in which you deregistered, and the next year.