NETHERLANDS VAT RATE WILL INCREASE TO 21% AS PER OCTOBER 1, 2012

On 11 July 2012 the Dutch Senate adopted the increase of the standard VAT rate from 19% to 21% with effect from 1 October 2012. The reduced rate for certain goods and services will remain 6%.

Decisive factor for applying the higher VAT rate
The moment that the pertinent goods are actually supplied or the services are actually rendered is the decisive factor whether to apply the 19% or the 21% VAT rate. Consequently, if goods are paid before the 1st of October but actually supplied after that date, the 21% VAT will still be due.

Ongoing supplies and services
Ongoing supplies or services which commenced prior to 1 October 2012 and continue after 30 September 2012, such as management and licensing services, subscriptions for the supply of gas, electricity and water, etc., will be taxed with two different rates. The new rate of 21% only applies to that part of the supplies or services carried out on or after 1 October 2012.


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