Netherlands

Overview

The Netherlands, a country situated in Northwest Europe, literally translates as lowlands or lower countries. It is known for being a developed and industrialized nation and is one of the prominent exporters of agronomy in the world. However, agriculture as an industry has become more mechanical. With a population of 17.4 million, the Netherlands provides a platform for many global courts and interstate organizations that are centered in The Hague – the nation’s legal capital.

At Global Upside, we can help your business or organization hire employees in the Netherlands, in addition to establishing a legal overseas office.

  • Global Upside manages services such as talent acquisition, human resources, accounting and payroll globally. Our team provides an end-to-end service to keep all the business operations running smoothly.
  • The hiring process in France can be complicated, not to mention the time-consuming and expensive process of starting a branch office. We help to lift that burden from your business.
  • We not only hire employees on your behalf, but also take care of any legal formalities involved.

Capital City

Amsterdam

Currency

Euro (€)

Language

Dutch

Government

Constitutional monarchy

Country Overview

The Netherlands has a booming and developed economy, which provides a base for an important regional and international commercial existence. Currently, the nation has emerged as a leading financial center, with communications and IT, banking, energy manufacturing and pharmaceuticals – all developing constantly.

  • Ranks as the 17th largest economy in the world with regards to the GDP.
  • Ranks as the 7th largest economy in Europe in reference to the GDP.
  • Ranks as the 6th most business friendly countries is the world.
  • The workforce here is highly skilled.

Legal Entity Setup

Due to extremely favorable conditions in the legal system, taxation environment, and flexibility in business, process of incorporation of a business is smooth.

In conformity with the Dutch law, the kinds of limited liability companies that are present are:

BV (Besloten Vennootschap) – Private Limited Liability Company

BV (Besloten Vennootschap) – Private Limited Liability Company is a prevalent way of doing business here as this is a legal entity which has risks only limited to the owners. The stockholders are responsible for their own investments. The minimum share capital required is €18,000.

NV (Naamloze Vennootschap) – Public limited company

NV (Naamloze Vennootschap) – Public limited company is a subsidiary of an overseas company and is owned by stockholders are the stocks are traded in the share market. The minimum share capital required is €45,000.

CV (Commanditaire Vennootschap) – Limited Partnership

CV (Commanditaire Vennootschap) – Limited Partnership is a kind of set up which needs minimum 2 partners: an active partner and a limited partner. The active partner is accountable to all the third parties and individual properties. Meanwhile, a limited partner is the financial sipporter of the business.

Sole Trader (Eenmanszaak)

Sole Trader (Eenmanszaak) is a kind of set up where the owner is a single individual and he or she is liable for all the liabilities.

Branch Office

Branch Office is easier to begin as compared to a subsidiary and is not considered as a distinct legal entity. The head office is usually accountable for all kinds of liabilities.

It takes at least three weeks to establish a legal entity setup in the Netherlands, depending on the kind of establishment required.

Human Resources

The employment settings in the Netherlands are structured by the Collective Employment Agreement (CEA), which are a collection of laws and obligations apropos provisional employees. It is a mandatory requirement that the employers here provide the staff with a statement which mentions all the specific terms in an employment contract.

There are two kinds of employment contracts:

  1. Fixed-term contract
  2. Indefinite tern contract

According to the Dutch employment laws, the detailed information of the following are required:

  • Work location
  • Job description
  • Name and address of both the employer and employee
  • Wage details
  • Overtime and bonus details
  • Holiday and leave entitlements
  • Other benefits and pension
  • Termination policy­

To know more, kindly visit the website and start your registration.

Payroll

The payroll frequency here is once a month, usually at the end of the month along with providing a pay slip which mentions the complete salary breakdown.

Accounting

All the local and international public businesses in the Netherlands needs to comply with the GAAP, Generally Accepted Accounting Principles which is comprised of IFRS, International Financial Reporting Standards as implemented by the EU.

Taxation

Corporate Tax

The income tax rate on revenues incomes more than €200,000 remains constant, i.e. 25%. However, income tax rate on earnings up to €200,000 has been decreased to 16.5% from 19%.

VAT

The common VAT rate is 21% and a reduced rate of 9% on food items, medical devices, etc.

Data Privacy/ GDPR

The Dutch Data Protection Act (Wet bescherming persoonsgegevens, Wbp) has been replaced by the General Data Protection Regulation (GDPR) also known as Algemene Verordening Gegevensbescherming (AVG). According to the European GDPR, the guidelines concerning to the automated processing of personal details have been restricted.

Anti-bribery & Anti-corruption Law

As per the Dutch Criminal Code, DCC, there are two forms of bribery – active bribery and passive bribery. The former refers to the bribing of a public official and the latter identifies with the officials being bribed. Regulation of Article 177 DCC states penalization for active bribery, while Article 363 is to penalize for passive bribery.

  1. Bribery of public officials
    • For individuals –
      1. Imprisonment of at least 6 years.
      2. Fine of €82,000.
      3. Prohibition from their work for a certain period of time.
      4. The relevant items of bribery will be seized.
    • For a legal entity –
      1. Seizure of all items of bribery.
      2. Fine of 10% of yearly business.
  2. Bribery of private individuals
    • For individuals –
      1. Imprisonment of at least 4 years.
      2. Fine of €82,000.
      3. Prohibition from their work for a certain period of time.
      4. The relevant items of bribery will be seized.
      5. Issuing a verdict.
    • For a legal entity –
      1. Seizure of all items of bribery.
      2. Fine of 10% of yearly business revenue.
      3. Issuing a verdict.