As a foreign entrepreneur you can choose to appoint a tax representative in the Netherlands for handling your business with the Tax and Customs Administration. If you choose to appoint a tax representative then you will not usually be obliged to register for VAT directly. A customs forwarding agent, who take care of import and export formalities, often act as a tax representative as well. A representative has the ability to complete the following tasks on your behalf:
- Completing the VAT return
- Completing the intra-Community declaration
- applying the reverse-charge mechanism on import
Import reverse-charge mechanism
If you wish to apply the article-23 import reverse-charge mechanism on import then you must appoint a tax representative.
A tax representative must be established in the Netherlands and provide financial security for the owed VAT. They are jointly and severally liable and most representatives will request a deposit or high fee’s to off-set the risk.
You can also choose to appoint a Tax agent for representing you with the Tax and Customs administration who can handle the formalities on your behalf for registration and filing of the VAT and ESL declarations however they would not be able to apply the import reverse-charge mechanism unless appointed as a representative using a separate power of attorney.
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