Fiscal representation in the Netherlands: this is how representation in VAT matters works

In European member states, there has been no obligation to have a fiscal representative for companies based in the EU since 2004. However, foreign companies that do not have a permanent establishment in Europe must appoint a fiscal representative in the Netherlands. But a representative in VAT matters can also be worthwhile for EU companies. Here you can find out what a fiscal representative is, what he does in the Netherlands and how you can appoint a representative.

What is a fiscal representation?

Fiscal representatives are service providers who take care of all tax obligations of the client in the respective country. For example, fiscal representatives in the Netherlands can take care of the VAT obligations of clients from Germany, France, and the like. The following, among others, can act as fiscal representatives in the Netherlands:

• Tax consultant
• Lawyers
• Chartered accountants and sworn accountants
• Notaries
• Forwarding companies and customs agents, insofar as they provide assistance in matters of import duties

You can find more general information on fiscal representation in the EU on our overview page.

What does a fiscal representative do in the Netherlands?

After his appointment, a fiscal representative will take care of the following points, among other things:

• Submission of the VAT return
• Submission of the intra-community turnover report (ICP report)
• Use of the reverse charge mechanism for imports

In the Netherlands, according to Article 23, there is also the possibility of applying for a license to defer VAT. In the course of this VAT deferral system, no import VAT has to be paid, which can lead to a cash flow and interest rate advantage for the foreign company.

When do I need a fiscal representation in the Netherlands?

As in all other EU member states, companies that are not based within the European Union are obliged to appoint a fiscal representative in the Netherlands. This obligation applies if a company imports and exports via the Netherlands, or is otherwise liable for VAT, for example through sales to Dutch private individuals.

This obligation does not apply to companies based in an EU member state. However, there are many advantages to voluntarily appointing a representative.

• You don’t have to register your company (yourself) in the Netherlands
• You don’t have to set up a VAT administration
• You do not have to pay the VAT directly on import, as this is included in the VAT return of the representative

Furthermore, a fiscal representative in the Netherlands facilitates contact with the authorities and guarantees the timely submission of all documents and thus the avoidance of fines.

Appointment of a fiscal representative in the Netherlands

In principle, the fiscal representative can be freely elected in the Netherlands. However, he has to meet a few requirements:

• The fiscal representative must be resident in the Netherlands
• The fiscal representative has to secure the VAT financially

At the beginning of the representation, he must apply for a permit to represent the foreign company (the client) in the Netherlands. From this point on, the fiscal representative takes care of, among other things, the VAT return, the administration and reporting of intra-Community deliveries to other EU member states (ICP reporting) as well as the statistical reporting to Statistics Netherlands.

Special case: the limited fiscal representative in the Netherlands

In some EU member states, including the Netherlands, another form of fiscal representation is permitted: small or limited fiscal representation. While a general representative on behalf of a non-resident company is responsible for all of its supplies and services, the intra-community acquisitions of goods and the importation of goods for which Dutch VAT is charged, a limited license fiscal representative only takes care of the importation of goods and the subsequent B2B delivery of these goods.

To do this, he uses his own Dutch VAT identification number and also declares goods under this his own number. Under the limited fiscal representation, a foreign seller cannot make B2C sales or buy goods in the EU or the Netherlands. As soon as this happens, the foreign seller needs his own identification number and must therefore either take care of his registration himself if he is based in the EU, or appoint a normal fiscal representative if he is based outside the EU.

Fiscal representation in other European countries

In addition to the Netherlands, many other European member states also have a fiscal representative obligation for companies not based in the EU. In most EU countries there is also the option of voluntarily appointing a representative to meet tax obligations. However, the local legislation is always decisive. You can find more information on fiscal representations in other European countries such as Germany, Austria and France on our country-specific pages.

country	mandatory fiscal representation for non-EU companies and sellers
Germany	yes
Netherlands	yes
Austria	yes
Polen	yes
Czech Republic	no
Spain	yes
Italy	yes
France	yes

In addition to individual fiscal representations, it can also be worthwhile to hire a specialized service provider. This option is particularly attractive for multinational dealers, importers and exporters, as well as distance sellers who sell goods via online marketplaces such as Amazon or via fulfillment programs such as FBA. Service providers specializing in EU-wide VAT compliance, such as hellotax, can represent you in tax matters not only in one member state, but in a number of EU countries and take care of your VAT registration, submissions and VAT collection. Since our tax consultants work closely together, you also receive all information bundled and your administrative and financial effort is further reduced.

Contact us today and simplify the handling of your tax obligations.

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