Taxes

Everybody is liable to pay tax. Which means that you have to make your tax return (inkomstenbelasting) if you work for yourself. If  you are in employment, your employer pays taxes (loonbelasting) for you.

Tax returns

If you have just one job, your employer is responsible for your tax and social insurance payments (PAYE). If you have no further expenses such as mortgage or alimony, you do not have to make a tax return.

If you have several jobs, or are self-employed / working freelance, you should request and complete an Income Tax return. You also have to keep basic books: opening and closing balance sheets and a profit-and-loss account. But you can offset the costs incurred in carrying out the work against tax.

Average income regulation

Artists' incomes in particular can fluctuate sharply. An increase in income may put you in a higher tax category. If so, you pay more tax on a part of your income. In that case you can make use of the average income regulation, middelingsregeling in Dutch. You calculate your average income over three years. This results in a drop in the (higher) income that falls within the higher tax category and reduces the amount of tax you have to pay.

Your consultant can tell you more about this possibility. For more information click on the Tax Office website (Belastingdienst.nl).

Turn over of VAT (btw)

People who just started their own business usually work as a freelancer. As a soon as you have an income, you have to apply at the Chamber of Commerce. The Tax Administration (Belastingdienst) decides if you are obliged to charge turnover tax (VAT/btw). This depends on the amount of the expected turn over. The low tariff in the Netherlands is 9% as of 2019, the high or general tariff is 21%.

If you are an artist or musician working according to a model agreement, you can send an invoice. If you don't have a model agreement you have to deal with the so-called Artiestenregeling (Performing Artists Tax Scheme), the kleinevergoedingsregeling (Incidental Expenses Allowance Scheme) and the Gageverklaring (Fee Statement Form).