Businesses importing goods into the Netherlands need to handle several charges beyond the supplier’s invoice. They may need to pay import duties, import VAT, customs clearance fees, and other product-specific taxes before they can release or deliver the goods. Further, these import taxes increase the cost and can significantly affect the final price of imported products.
Whether you’re importing stock for resale, raw materials for production, or equipment for business use, a better understanding of the import tax calculation in advance helps with budgeting, pricing, and cash flow planning.
Further, there are multiple factors that impact the import tax, such as the product’s customs classification, customs value, country of origin, and import procedure. Keep in mind that the import duty and import VAT are also calculated differently.
In this post, you will read about how to estimate import duties in the Netherlands, calculate import VAT, identify possible reductions, and understand the additional costs businesses should include when shipping goods into the country.
For businesses in the Netherlands that are importing goods from outside the European Union (EU), businesses may need to pay more than one type of tax or charge. The main import taxes businesses pay while importing goods:
When goods arrive from a country outside the European Union, the import duties are generally relevant. However, for goods moving between EU member states, they are not normally subject to import duty. However, VAT and other applicable tax obligations may still arise. Due to the common customs tariff in the EU, the customs duty rate for a product is generally the same across EU member states. VAT and certain other taxes can differ by country.
The import duty is usually calculated using the customs value of the goods and the applicable tariff rate. However, the applied import rate depends on the product’s TARIC code and country of origin. Here’s how import duty is calculated:
Import duty = Customs value × Applicable import duty rate
This formula applies to goods where the tariff is expressed as a percentage of customs value. Some products have specific or combined duties calculated using quantity, weight, or other measures.
The customs value is generally calculated based on the value of the goods when they enter the EU. It commonly inlcudes:
Keep in mind that the customs value of the goods is not necessarily the same as the supplier’s invoice value. For example, if the invoice covers only the goods and the buyer pays separately for transport and insurance to the EU border, those costs may need to be included.
EU customs valuation rules generally use the transaction value as the main method, subject to required additions and deductions. Other valuation methods may apply if the transaction value cannot be used.
The goods imported into the European markets are mentioned with a TARIC code for customs purposes. The code helps identify the tariff rate and any additional import requirements. Businesses importing or exporting goods outside the EU should also check whether they need EORI number registration to complete customs procedures.
A TARIC code is based on the international Harmonised System (HS) classification. The code generally contains 10 digits for EU customs purposes, though additional digits or measures may apply in specific cases. The correct classification depends on the product’s characteristics, composition, intended use, and other relevant details. Similar products can have different codes and duty rates.
The country of the goods affects the applicable import duty rate. Imported goods that qualify under an EU trade agreement may be eligible for reduced or zero duty, provided the relevant origin rules are met and the required proof is available. For businesses importing goods into the Netherlands should confirm:
Once the customs value, TARIC code, and origin are established, the next step is to determine the applicable duty. For example, assume a company imports goods from a non-EU country with the following details:
Note: The 5% rate is illustrative only. The actual rate depends on the goods’ TARIC code, origin, and any applicable customs measures.
For businesses importing goods into the Netherlands need to understand that import VAT is separate from import duty. It is generally calculated on a broader amount that includes the customs value, import duty, and certain additional costs. The simple VAT calculation involves:
Import VAT = VAT rate × VAT taxable import amount
The taxable amount generally includes:
The applicable Dutch VAT rate depends on the goods. The Netherlands generally has 21%, 9%, and 0% VAT rates, but the 0% rate does not apply to ordinary imports simply because a product is being imported. The correct rate must be determined based on the product and relevant VAT rules.
Businesses that are importing goods into the Netherlands should not treat import VAT as another import duty. The charges are calculated separately and may have different implications for the company’s accounting and cash flow.
When it comes to importing goods from one EU country ot another EU member state, they are generally not subject to import duty because of the EU’s free movement of goods. However, the treatment of value added tax depends on the transaction. A Dutch business acquiring goods from a VAT-registered supplier in another EU country may need to report an intra-Community acquisition in its Dutch VAT return.
However, the VAT treatment is completely different from importing goods from a country outside the EU, where customs declarations and import duty may apply. Businesses importing goods into the Netherlands should distinguish between:
Businesses that frequently import goods into the Netherlands may be able to use the Dutch Article 23 import VAT deferment arrangement if they meet the relevant conditions. Using the Article 23 arrangement, eligible businesses do not pay import VAT at the time of import. Instead, they declare the VAT in their Dutch VAT return.
This enables companies to enhance their cash flow since the company does not need to pay for the import VAT in advance. However, in case the amount to be deducted by the company as input VAT is equal, the import VAT can be handled and deducted in the same return as the rest. It should be noted that article 23 does not eliminate import VAT or import duties.
Businesses should also note:
For businesses importing regularly, Article 23 may be worth reviewing as part of their broader import and cash-flow planning.
Importing goods into the Netherlands involves customs valuation, tariff classification, import VAT, and accounting responsibilities. Businesses that import regularly need to understand how these costs affect cash flow and how the transactions should be recorded and reported.
Our team helps corporations with regard to VAT issues, accounting & bookkeeping, and tax-related procedures regarding the country of the Netherlands. In case a corporation is engaged in importing goods into the country, our company can provide help in the area of VAT reporting and VAT return procedures.
Importing goods into the Netherlands or reviewing your import VAT process? Contact FlorinTax to discuss your Dutch VAT and accounting requirements.
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The import duty is usually computed by determining the multiplication of the customs value of the goods and the rate of the tariff. The customs value normally comprises the transaction value of the goods and the cost of transportation and insurance of the goods up to the EU border.
No. Import duty is the tax levied on the basis of goods’ classification, valuation, and source country. Import VAT is computed on the basis of VAT taxable import value, which usually comprises customs value, import duty, and other related expenses. They are distinct taxes.
Most goods being traded between member countries of the EU are exempted from import duties. However, VAT requirements like filing of intra-Community acquisition in the Netherlands VAT declaration can be applicable in some cases.
If a company registered for VAT purchases goods which are to be used in activities entitling the company to deduct VAT, then the company is eligible for deduction of import VAT provided all conditions are satisfied.
Article 23 is an Dutch arrangement that enables qualifying companies to charge VAT on imports via the company’s VAT tax return rather than paying VAT on importation. This could help with cash flow, but it will not eliminate the obligation of VAT nor will it reduce customs duty.
