Turnover under € 20,000 a year? With the KOR (kleineondernemersregeling, the Dutch small business scheme) you charge no VAT, deduct no VAT and skip the quarterly VAT return. That saves a lot of admin - but for some businesses it costs real money. Here is how to decide, what the rules are, and how to set it up.
Invoices under the KOR are free in ProFaktura - one setting in your company profile removes the VAT rate and VAT amount from every invoice.
Every business in the Netherlands is in principle a VAT entrepreneur: you charge btw (Dutch VAT: 21%, 9% or 0%) on your sales, you deduct the btw you paid on your purchases, and every quarter you settle the difference with the Belastingdienst (the Dutch tax office) in a btw-aangifte (VAT return).
The KOR switches that whole mechanism off for small businesses. If your annual turnover stays under € 20,000, you can opt in. From then on:
Everything else stays the same. You remain registered with the KVK (Kamer van Koophandel, the Dutch chamber of commerce), you keep your records, you file your income tax return, and the invoice requirements still apply. The KOR is a VAT scheme, nothing more.
The threshold is your turnover in the Netherlands in a calendar year, not your profit. Turnover is the total of what you invoice, before costs. A part-time business that bills € 1,500 a month lands at € 18,000 and qualifies; the same business with one extra big project may not.
Since 2025 there is also an EU-KOR. If you sell to customers in other EU countries, you can apply a small business exemption there too, provided your total turnover across the whole EU stays below € 100,000. You then report your EU turnover every quarter. This is a separate registration with its own paperwork - if you work cross-border, discuss it with your accountant before you rely on it.
The scheme is attractive when your customers cannot deduct VAT themselves and your own costs are low. Typical cases:
Example: family photographer, consumers only. A shoot costs € 300. Outside the KOR the customer pays € 363 (€ 300 + 21% VAT), and you keep € 300. Inside the KOR you invoice € 300 and keep € 300 - or you invoice € 363 and keep it all. With 50 shoots a year that is up to € 3,150 more margin, and no VAT return. Your costs: a camera bought years ago, some software, fuel. The VAT you cannot deduct on those is far below € 3,150. Here the KOR is the obvious choice.
The scheme looks like a gift, but it has a price: you give up the VAT deduction on everything you buy. Two situations turn it into a bad deal.
A business client deducts the VAT you charge in its own return. To them, VAT is a pass-through - your invoice with 21% VAT costs them exactly the same as your invoice without it. You gain no price advantage at all, and you still lose the deduction on your own costs.
Under the KOR the VAT on a new laptop, a van, tools, a coworking desk or your accountant's fee is not reclaimable. If you are starting up and about to spend a few thousand euros on equipment, that lost VAT can wipe out any benefit for years.
Example: consultant, business clients only. Turnover € 18,000, so the KOR is available. Costs € 4,000 a year including 21% VAT - software, a laptop, travel, an accountant. The VAT inside those € 4,000 is € 694. Outside the KOR you reclaim that € 694 in your VAT return. Inside the KOR it is gone, and your clients gain nothing because they would have deducted your VAT anyway. Result: the KOR costs this consultant € 694 a year plus three years of being locked in. Here the KOR is the wrong choice.
A third case: you expect to grow. If you are at € 17,000 now and plan to pass € 20,000 next year, opting in gives you one year of savings and then an exit in the middle of a quarter, with VAT reappearing on your invoices. Ask yourself whether that is worth the switch.
You do not need a spreadsheet, just three honest answers:
Two points for the KOR and a realistic three-year outlook: opt in. Otherwise stay a regular VAT entrepreneur and let ProFaktura's VAT dashboard do the quarterly work for you.
Once the Belastingdienst has confirmed your registration, open your company profile in ProFaktura and turn on the KOR setting. From that moment every invoice you issue:
If you leave the scheme later, you turn the setting off and VAT returns to your invoices. Nothing else changes: the same clients, the same numbering series, the same archive. Invoices and credit notes are free in ProFaktura without limit - the KOR mode is part of that free plan, not an extra.
Not sure yet whether the KOR fits? Read how a correct Dutch invoice is built and what changes when you invoice a business in another EU country under the reverse charge. Both pages explain the version with and without VAT.
No. As long as you are in the scheme you do not file the quarterly btw-aangifte. You do keep your records and you still file your income tax return - the KOR only concerns VAT.
No. The exemption works both ways: you charge no VAT and you deduct no VAT. If you are about to buy expensive equipment, it can be worth staying out of the scheme until that purchase is done.
The scheme ends and you charge VAT again. Exceeding the threshold is the one situation in which you can leave before the three-year minimum. Check the exact steps on belastingdienst.nl or ask your accountant, because the timing matters for the invoices you send in that quarter.
Not freely. Once you opt in, you stay in for at least three years unless your turnover exceeds the threshold. That is why the decision deserves a proper calculation first.
No. The KOR is a VAT scheme only. Income tax, the hours criterion and deductions such as the zelfstandigenaftrek are separate and stay exactly as they are.
Read next: VAT return in the Netherlands · reverse charge VAT · how to invoice in the Netherlands