The sales tax applies to almost all entrepreneurs and self-employed persons. But when and how do you actually file a report? And what about the VAT percentages of 0%, 9% and 21%?
When do you pay sales tax?
The sales tax is recurring quarterly for most entrepreneurs. If you pay less than € 1,883 in VAT per year, you can file a return per year. Do you have to pay more than € 15,000 per quarter? Then you file a declaration per month. You can submit tax by zip code and have the best options there now.
Oops, forgot to pay? Then you can be fined 3% of the amount to be paid, with a minimum of € 50 and a maximum of € 5,278.
Handy: you can set to receive an email every time you have to make a declaration. So you are never too late.
How sales tax works
If you supply products and services as an entrepreneur, there is a good chance that you will have to charge VAT on this. This is a percentage of the price (0%, 9% or 21%) that you must pay to the tax authorities. You charge this extra to your customer.
- Always indicate in price agreements whether a price includes or excludes VAT.
- There are professions where you do not have to pay VAT. Consider, for example, healthcare or journalists who do not do commercial work.
Reclaim VAT
At the same time, you pay VAT on goods or services you purchase. You may deduct this VAT as input tax on your turnover tax return. Always keep the original invoice / receipt for this in your administration. Please note: you may only deduct business expenses. You may not deduct VAT on:
Private purchases
- Expenses you incur for exempt turnover
- Food and drink in the catering industry
- Employee benefits, gifts and business gifts (of more than € 227 per person per year)
VAT rates
- There are three different rates. Which applies to you depends on your specific situation.
- The standard VAT rate is 21%. Most goods and services are covered.
The reduced VAT rate is 9%
This applies to goods and services that the government considers important for everyone to be able to use. Think of foods, medicines and books. Before 2019, the low rate was still 6%. Read all about the consequences of this development. Using the state tax calculator in that case.
The lowest VAT rate is 0%:
You apply this rate, for example, if you export or store goods in a customs warehouse. Do you write for the local newspaper? Then you do not have to charge VAT.
File a sales tax declaration
When you registered as an entrepreneur at the Chamber of Commerce (Chamber of Commerce), you automatically received a VAT number from the tax authorities. This is proof that you are an entrepreneur for the sales tax. You should at least state this VAT number on your invoices.
