Types of Business Entities in the Netherlands

Key Takeaways

• The Netherlands has four main business structures: eenmanszaak (sole proprietorship), VOF (partnership), BV (private limited company), and stichting (foundation).
• The eenmanszaak and VOF are not separate legal entities — you are personally liable for business debts.
• The BV and stichting are separate legal entities — your personal liability is limited.
• Your choice of structure affects how you are taxed, your personal risk, and your administrative burden.
• Most sole entrepreneurs start with an eenmanszaak and convert to a BV when profits grow.

Overview of Dutch Business Structures

Dutch law recognizes several legal forms (rechtsvormen) for doing business. The four most common for small to medium-sized businesses are:

There are also less common forms like the NV (Naamloze Vennootschap — public limited company, used by listed companies), CV (Commanditaire Vennootschap — limited partnership), and maatschap (professional partnership, common among doctors and lawyers). This guide focuses on the four structures most relevant to entrepreneurs and expats.

Eenmanszaak (Sole Proprietorship)

The simplest and most popular business form in the Netherlands. Over 1 million businesses in the Netherlands are registered as eenmanszaak.

How it works: You and the business are legally the same. There is no separation between your personal and business assets. Your business profit is your personal income.

Key characteristics:

• Register at the KVK for €75. No notary required.
• You are personally liable for all business debts. Creditors can seize your personal assets.
• Profits are taxed as Box 1 income at progressive rates (35.75%–49.50%).
• Access to entrepreneur deductions (zelfstandigenaftrek, startersaftrek, MKB-winstvrijstelling) — can save you thousands per year.
• Simple administration — no annual accounts filing, no shareholder meetings.

Best for: Freelancers, consultants, small service businesses, and anyone starting out who wants simplicity and maximum tax deductions.

Read more: Eenmanszaak in detail

VOF (Vennootschap Onder Firma — General Partnership)

A partnership between two or more people who run a business together under a shared name.

How it works: Each partner contributes capital, labor, or both. Profits are divided according to the partnership agreement. Each partner is personally liable — not just for their share, but for all debts of the partnership.

Key characteristics:

• Register at the KVK for €75. A partnership agreement (VOF-contract) is strongly recommended but not legally required.
• Joint and several liability — each partner is personally liable for the full debts of the VOF, even those incurred by other partners.
• Each partner files their own income tax return and is taxed on their share of the profit.
• Each partner can access entrepreneur deductions individually (if they meet the hours criterion).
• If one partner leaves or dies, the VOF is legally dissolved (unless the contract specifies otherwise).

Best for: Small businesses with two or more active partners — for example, a couple running a restaurant, or two consultants starting a firm together.

Read more: VOF in detail

BV (Besloten Vennootschap — Private Limited Company)

The most important business structure for growing companies. A BV is a separate legal entity with its own rights and obligations.

How it works: You incorporate the BV through a notary. The BV has shares, and you (as the founder) own all the shares. The BV earns the income, pays corporate tax, and you receive income through salary and/or dividends.

Key characteristics:

• Incorporation through a notary — costs €500–€2,000+ for the deed of incorporation.
• Minimum share capital: €0.01 (there is effectively no minimum capital requirement).
• Limited liability — your personal risk is limited to your share capital. Creditors cannot seize your personal assets (with some exceptions for director liability).
• Profits are taxed at corporate income tax rates: 19% on the first €200,000, 25.8% above that.
• Distributions to shareholders are taxed at 26.9% (Box 2 — income from substantial interest).
• If you are a director and own 5%+ of the shares, you are a DGA (directeur-grootaandeelhouder) and must pay yourself a minimum salary.
• More administration — annual financial statements, corporate tax returns, payroll for your DGA salary.

Best for: Businesses with consistent annual profits above €100,000–€150,000, entrepreneurs who want liability protection, companies seeking external investment, and holding structures.

Read more: BV in detail

Stichting (Foundation)

A legal entity established for a specific purpose, without shareholders or members. In the Netherlands, stichtingen are used for far more than just charities.

How it works: A stichting is incorporated through a notary. It has a board of directors but no shareholders. It cannot distribute profits to its founders or board members. However, it can run a commercial business as long as the profits serve the foundation's stated purpose.

Key characteristics:

• Incorporation through a notary — costs €500–€1,500+.
• No shareholders, no members — governed by a board (bestuur).
• Cannot distribute profits to founders or board members. Profits must serve the foundation's purpose.
• If the stichting conducts commercial activities, it pays corporate income tax on those profits.
• A stichting with ANBI status (Algemeen Nut Beogende Instelling — public benefit organization) is exempt from most taxes and can receive tax-deductible donations.
• Relatively simple to set up but has strict rules on governance and purpose.

Best for: Non-profit organizations, charities, social enterprises, cultural organizations, and specialized holding structures.

Read more: Stichting in detail

Side-by-Side Tax Comparison

To illustrate how the choice of structure affects your tax bill, here is a simplified example for a business earning €120,000 profit in 2026:

How to Choose

Ask yourself these questions:

1. What is your expected annual profit? Below €100,000 → eenmanszaak. Above €150,000 → consider a BV.
2. Do you need liability protection? If your business involves significant risk (contracts, inventory, employees), a BV limits your personal exposure.
3. Do you have a business partner? Consider a VOF or a multi-shareholder BV.
4. Is your purpose non-commercial? A stichting may be appropriate.
5. Do you plan to attract investors? Investors strongly prefer BVs, as they can buy shares.
6. How much administration can you handle? Eenmanszaak is simplest. BV is most complex.

What to Read Next

• Eenmanszaak — Everything about the sole proprietorship
• VOF — Partnership structure explained
• BV — Private limited company deep dive
• Stichting — Foundation structure and uses
• When to Set Up a BV — Decision framework for the eenmanszaak-to-BV transition