For many entrepreneurs, VAT filing is a recurring task that brings both structure and stress. What exactly is VAT? How do you file it correctly? And how can you avoid getting caught up even unintentionally in VAT fraud? In this article, we break it all down clearly: what to do, what to avoid, and how to make VAT work for your business instead of against it.
What Is VAT and why do you file it?
VAT stands for Value Added Tax, the tax you charge on your turnover. You add it to your product or service price and pass it on to the Dutch Tax Authority (Belastingdienst). At the same time, you can reclaim the VAT you’ve paid on your own business expenses this is known as input tax. Your VAT return (also called the turnover tax return) reconciles these two amounts. You pay the difference between the VAT you’ve received and the VAT you’ve paid. Even if you haven’t made any sales in a given period, you’re still required to file your return.
When and how to file your VAT return
Most businesses file their VAT returns quarterly. This means you must submit and pay your return within one month after the end of each quarter. For 2025, these are the key deadlines:
- 1st quarter → 30 April 2025
- 2nd quarter → 31 July 2025
- 3rd quarter → 31 October 2025
- 4th quarter → 31 January 2026
Some entrepreneurs file monthly or annually. If your total VAT owed per year is less than €1,883, you may be eligible to file once a year instead with your return due by 1 April of the following year.
You can file your return:
- Through Mijn Belastingdienst Zakelijk (the Dutch Tax Authority’s online portal)
- Using accounting software connected to the Belastingdienst
- Or via your accountant or bookkeeper
You’ll log in with eHerkenning (for companies) or DigiD (for sole traders). Once submitted, you can pay immediately via iDEAL or transfer the amount manually.
What you’ll need for your VAT return
Good preparation prevents mistakes. Make sure your records include:
- All invoices sent and received that include VAT
- Any cross-border transactions
- Details of private use of business goods or services
- Your VAT identification number (VAT ID)
Note: For VAT purposes, the invoice date determines the reporting period not the payment date. So if an invoice is dated in September but paid in November, it still belongs to your third-quarter return.
The Small Business Scheme (KOR)
If your annual turnover is less than €20,000, you may qualify for the Small Business Scheme (Kleineondernemersregeling – KOR). This allows you to stop charging VAT to customers and skip filing returns altogether. However, you can no longer reclaim input VAT on expenses. It’s a useful option for small or starting entrepreneurs who want to simplify their bookkeeping.
Common mistakes in VAT returns
Even experienced entrepreneurs slip up sometimes. Here are the most frequent errors:
- Missing the deadline: results in a tax assessment and fine. Use a VAT reminder app or SMS alert to stay on track.
- Reporting in the wrong period: remember, the invoice date determines when VAT applies.
- Missing receipts or invoices: no valid proof means no deduction.
- Incorrect VAT deductions: you can’t reclaim VAT on things like restaurant meals, private purchases, or certain exempt services such as education or journalism.
What does “VAT reverse charge” mean?
Sometimes an invoice states “VAT reversed” (btw verlegd in Dutch). This means that instead of the seller, you as the buyer are responsible for reporting and paying the VAT. The reverse charge mechanism is common in construction, cleaning, horticulture, and international trade. Always ensure the phrase “VAT reversed” and the recipient’s VAT number appear clearly on the invoice.
Avoid getting caught in VAT fraud
VAT fraud doesn’t just harm the government it can harm your business too, even unintentionally. If you deal with fraudulent suppliers, your own VAT deductions can be challenged.
Stay alert for warning signs such as:
- Prices that seem too good to be true
- Incomplete or inconsistent invoice details
- Suppliers who frequently change industries or addresses
- Companies with little or no business history
Always verify VAT IDs, check Chamber of Commerce registrations, and investigate unusual deals. If something feels off it probably is.
Smart tips for a smooth VAT process
- Use accounting software: automate transactions and reduce human error.
- Track start-up costs: VAT on pre-launch expenses (like your website or logo) may be deductible.
- Keep digital records: invoices and receipts must be stored for seven years.
- Separate business and personal accounts: it keeps your books cleaner and makes filing easier.
- Ask for advice: when in doubt, consult a financial professional.
VAT filing doesn’t have to be stressful. With solid administration, a basic understanding of the rules, and a watchful eye for red flags, you can save time, money, and headaches. Whether you’re just starting out or running a growing company, smart VAT management keeps your business compliant and your mind at ease.
