A Cost Overview Guide
Tuesday March 22, 2022
As a starting entrepreneur, you’re going to wear many different hats. One of these hats will be budget control, an activity you should keep an eye out for from the get-go.
So what’s the first thing on the agenda? Understanding all costs you can expect when setting up your company in the Netherlands. The following guide will walk you through all the important cost components you should consider for a startup so that you avoid any unpleasant surprises.
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The rise of startups in the Netherlands has been quite spectacular in the past decade, with its consistent ranking of being being in the top 10 of the most competitive economies worldwide.
When setting up a company in the Netherlands, you should consider several fundamental factors, such as:
Engaging a local accountant or legal advisor can be invaluable for navigating these complexities and ensuring a smooth company setup process in the Netherlands.
Moreover, the Netherlands is primarily known for having a very friendly fiscal setup. A BV (limited liability company) setup cost is around €1,000 on average. The setup costs of a BV are relatively much cheaper compared to many other countries around the world.
The overall costs for setting up a company in the Netherlands largely depend on how you manage your money and the choices to keep these costs low.
There are three main entities with which a company can register: sole proprietorship, BV, and Holding.
An eenmanszaak is a single-person company in the Netherlands. As a single trader, you are solely and completely responsible for the company, its finances, and its debts. In the Netherlands, you may establish just one sole proprietorship, but you can use various trade names and take on different commercial activities.
You are required by law to keep accounting records for your firm. There are a number of criteria for your records. The finances (the books) are an important aspect of your company’s documents. They provide insight into your company’s financial health by determining if all bills have been paid.
A BV is a limited liability company. The shareholders of a BV are not liable for the debts of the company. This type of company is suitable for companies with more than one shareholder. A minimum of two shareholders is required to establish a BV.
The shareholders are liable for the debts of the company up to the amount they have invested in the company. The company’s assets can be used to repay its debts. A BV must have a board of directors that is responsible for the management of the company.
A Holding can be used to divide your company structures into several BV’s, allowing you to never be personally responsible in the case of bankruptcy. The Netherlands has a strong global reputation and is, therefore, an excellent location to establish a business. The BV is internationally renowned as part of the Holding, giving it the ideal position for conducting local and international trade.
When you establish a company in the Netherlands, you will need to register it with the Chamber of Commerce. The Chamber of Commerce is responsible for issuing business licenses and registering companies. After your company has been registered, you will receive a Certificate of Incorporation. This document is proof that your company has been legally established and can now start operating.
Office rental prices in the Netherlands vary widely depending on factors such as location, size, and the level of amenities and services offered.
In major cities like Amsterdam, Rotterdam, and Utrecht, prime office spaces in central business districts can be relatively expensive, with prices ranging from €250 to €700 per square meter per year or even higher. These premium locations offer easy access to transportation, networking opportunities, and a prestigious business address.
In contrast, office spaces in less central areas or smaller cities can be more affordable, with rates starting from €150 to €300 per square meter per year.
Co-working spaces and flexible office solutions are also prevalent adding further diversity to the market. These options allow businesses to rent desk space with options like a Day Pass, Premium Desk or Private Offices on a short-term or flexible basis, offering a more budget-friendly alternative to traditional leases which is great for startups.
Ultimately, the rental price range in the Netherlands offers a spectrum of choices to accommodate a wide range of businesses and their specific needs.
You will need to purchase equipment such as a telephone, computer and other essentials that your business requires. This can vary depending on the type of company you’re setting up, but for an average startup, it’s around €2,000.
To make sure you do not mess up your taxes, especially as a startup, getting an accountant is a necessary investment. Accountants can get quite expensive in the Netherlands. Expect to pay between €150 – €300 per month for accounting services.
Getting legal advice is extremely important when setting up a company in any country, let alone the EU. Legal services in the Netherlands are expensive compared to many other European countries, but they can be much more costly in other non-EU countries. Expect to pay around €200 – €500 p/m for legal services.
There are different types of taxes in the Netherlands:
Tax rates vary depending on which setup you choose and how your business is structured.
The cost overview is divided into two parts:
Coworking spaces and startup offices offer an excellent, low-cost alternative to office rental in the Netherlands. Coworking spaces can vary in price from around €100 – €400 per month for a basic, shared office space. In addition to this, although you are renting a place that you share with others, you can still personalise it in a way that you can have your own office or desk.
When renting an office, you can choose specific services for your business. This can be very useful in reducing monthly expenses.
For example, if you are just starting your company and want to rent a space at 42workspace, you can opt for a Premium Desk that offers meeting rooms, phone booths, coffee, kitchen, and printing. Meanwhile, as your company grows, you move to a Shared Office that offers all the previous services and a dedicated desk, furnished space, and cleaning services. And finally, Private Office will provide you with your very own space for your team.
Hiring interns and part-timers at the early stages of your startup can help you save money. Although these employee members will likely work for less, you can help incentivise them by giving them responsibilities equal to their work and increasing their hourly rate as your company grows.
Automation platforms can help you save a lot of time, money, and other resources to conduct administrative work. This is especially true for companies with a minimal workforce and startups. Take advantage of automation tools such as:
If you are looking for more ideas, check out these top 10 IT automation tools.
SaaS solutions are a great way for startups to get up and running quickly and efficiently. By leveraging the power of the cloud, you can focus on your product and customer base rather than on managing servers and other back-end infrastructure.
In addition, SaaS solutions can help you lower costs since you don’t have to pay setup fees. Instead, you typically spread the payments into monthly instalments.
There are some grants and subsidies available from government organisations that you should look into when setting up a business in the Netherlands. They even assist startups, which can help relieve the financial stress that entrepreneurs encounter in their early days. The Netherlands Enterprise Agency (RVO) provides most grants & subsidies. These grants and subsidies can be on a local, regional, national or international level.
Always seek to generate income from day one, and make sure you have a sustainable business model. If it doesn’t work, re-evaluate your startup business model, revisit your lean canvas, and try again.
The Dutch government has implemented several schemes to help cover your costs. However, use these loans or grants responsibly to reap the benefits. Do not use them to “test” your business idea; instead, use them to get your company off the ground.
You should also look into your savings and investments.
Startups are often founded on very little capital, so seed funding can play a crucial role in helping new businesses get started with minimal financial stress.
You should also consider getting more involved in your local startup scene. This could be through joining networking events that expose you to investors and people interested in making meaningful connections with like-minded people.
If all else fails, consider asking for help from your family members. Although it is often taboo to ask for financial assistance from them, it can be a massive help during the early stages of your startup. However, always be mindful that they may not have much money or other resources to offer.
Moreover, you should consider pitching your business idea to various investors. This is another excellent way to raise money. For example, you can pitch to angel investors or venture capitalists (VCs) who might be interested in your product or service.
As any entrepreneur knows, the first few years are crucial for your business. Therefore, it is essential to stay patient and focused during this time, so you can take advantage of opportunities as they come along. This way, your startup can grow steadily and have a better chance of achieving long-term success.
There are many ways to set up a company in the Netherlands with limited financial resources. Although it is relatively expensive, you should not let this discourage you. Consider researching grants and subsidies available to startups, and rent co-working spaces with shared facilities. Be patient and stay focused on building the company you always dreamed of.
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