Netherlands: Competitive customs and VAT climate
By Toon Hasselman, LIMES International B.V.
The Customs Administration of the Netherlands is known for its practical and pro-active approach towards facilitating international trade and optimising customs and VAT procedures. Since the abolition of the internal border in 1993, the authorities have issued regulations to facilitate the import and distribution of goods into the EU via the Netherlands.
One of these measures avoids the actual cash payment of VAT on importation (Article 23). Under this measure, the import VAT that falls due is deferred to the VAT return of the goods recipient holding this assignment. This deferment scheme is only directly available to Dutch companies and foreign companies with a VAT-permanent establishment in the Netherlands.
A foreign company can benefit from this deferment scheme at any time if it appoints a VAT fiscal representative (Article 33g NL VAT Act) with a general or limited licence. Most logistic service suppliers provide the benefits of the limited licence and will report the VAT consequences of the import and the first taxable event alter import on a specially issued VAT ID.
As they are fully liable for any VAT mishap, they will want to control the supply chain for that part. A general licence means that the company obtains its own VAT ID and assignment and must provide a guarantee amount (roughly 5 x 5% x VAT rate of the value of quarterly import and acquisitions).
LIMES International B.V., Noordwijk, the Netherlands
T: +31 71 750 68 00
Toon Hasselman is a VAT specialist who has been working in the field of indirect tax for more than 20 years. Serving clients from national and international companies and having worked in every existing kind of indirect tax branch, he offers pragmatic solutions on a cost-effective basis.
LIMES International B.V. is an independent international tax consultancy firm specialising in cross-border issues. It focuses exclusively on companies and expats that cross borders, providing them with a broad range of integrated solutions in tax and expat, legal, payroll, immigration and relocation, pension and insurance, HR and VAT and customs services.
published: May 2014