VAT rates in the Netherlands: standard, reduced and zero rate explained
Which VAT rates apply in the Netherlands? When do you charge 21%, 9% or 0%? And what is VAT-exempt? Complete overview for entrepreneurs.
What are the VAT rates in the Netherlands?
In the Netherlands there are three VAT rates: the standard rate of 21%, the reduced rate of 9% and the zero rate of 0%. In addition, certain supplies are fully exempt from VAT. The standard rate applies to most goods and services. The reduced rate is intended for basic necessities such as food, books and medicines. The zero rate applies to exports and intra-Community supplies within the EU — you do not charge VAT, but you are still entitled to deduct input VAT. For exempt supplies (such as medical care and education) you do not charge VAT and you are also not entitled to deduct input VAT. Which rate you apply directly affects your VAT return and your bookkeeping. Read more about VAT / sales tax.
The standard rate: 21%
The standard VAT rate in the Netherlands is 21%. This rate applies to most goods and services, unless an exception applies. Examples:
- Electronic equipment and software
- Clothing and shoes
- Cars and parts
- Advisory and consultancy services
- Hospitality (non-food/drink related)
- Marketing and advertising services
The reduced rate: 9%
The reduced VAT rate of 9% is intended for basic necessities and specific services:
- Food (except alcoholic beverages)
- Water via the water mains
- Books, newspapers and magazines (including digital)
- Medicines and medical devices
- Passenger transport (train, bus, taxi)
- Painting and plastering work on homes older than 2 years
- Repair of bicycles, shoes and clothing
- Hairdressers and other personal care
- Culture (museums, theatre, cinema)
The zero rate: 0%
With the zero rate you charge 0% VAT, but you are still entitled to deduct input VAT. This applies to, among others:
- Intra-Community supplies (sales to entrepreneurs in other EU countries)
- Export outside the EU
- Seagoing vessels and aircraft
- Certain cross-border services
VAT-exempt
With a VAT exemption you charge no VAT and you are also not entitled to deduct input VAT. Important exemptions:
- Healthcare (doctors, dentists, physiotherapists)
- Education (recognised courses)
- Financial services (banking, insurance)
- Rental of immovable property (residential)
- Sport (amateur sports associations)
Frequently asked questions
As a self-employed person, do I always have to charge 21% VAT?
No, the rate depends on the type of product or service you supply. A self-employed person who sells books charges 9%; a consultant charges 21%.
What if I accidentally charged the wrong rate?
You can issue a credit note for the original invoice and send a new invoice with the correct rate. Also correct your VAT return.
How do I process this in my bookkeeping?
In Giroo you select the correct VAT rate for each transaction. With scan & recognise, the rate is automatically detected from the invoice. Make sure your invoices meet all legal requirements.
Can I use the small business scheme (KOR)?
Perhaps. The KOR (kleineondernemersregeling) offers VAT exemption for small entrepreneurs. Read more about the small business scheme.