Sole proprietorship or limited company (bv): what’s the best choice?
Dutch tax return: sole proprietorship vs. BV
There is a difference in filing tax returns between a sole proprietorship and a bv:
- A sole proprietorship pays income tax on the profit.
- The bv pays corporate tax on the profit and dividend tax (26.9%) on the profit distribution. In addition, the bv must pay a salary to the DGA, on which the DGA pays income tax.
From sole-proprietorship to a BV
Do you expect your profit to be around or above the turning point? Then it might be fiscally advantageous to convert your sole proprietorship into a bv. Or is the profit of your bv declining? Then, you can convert it to a sole proprietorship.
Do you doubt whether converting the legal form will be beneficial for your taxes? We are happy to advise you about this. Feel free to contact us using the details below.