Am I eligible for the small business scheme (KOR)?

You are entitled to tax relief if you pay less than € 1.883 VAT (turnover tax) every year. If this applies to you, you are eligible to use the small business scheme (known in Dutch as the kleineondernemersregeling, or KOR).

Terms and conditions for the KOR

The KOR is a scheme designed to give small businesses a chance to adjust to their VAT obligations. To qualify for the scheme, you must meet the following conditions::

  • You are a natural person (not a legal person in the form of a private limited company (bv) or public limited company (nv)). Legal persons such as a private limited company or public limited company do not qualify for the KOR
  • You – and your company – are located in the Netherlands. Entrepreneurs established abroad are not eligible for the KOR
  • You meet the administrative VAT obligations
  • You pay less than € 1.883 VAT (an amount below the annual threshold)

Am I eligible for the KOR?

The answer to the question is… Yes, you’re eligible for the KOR if the amount of VAT (VAT on your turnover minus the VAT on your expenses) is lower than the annual threshold of € 1.345. If this is the case, the entire amount is eligible for the KOR and you are not required to pay tax. If the amount of VAT you are obliged to pay is between € 1.883 and € 1.345, you pay a portion of that yourself, and the rest falls under the KOR. But remember: the tax relief you gain from the KOR is included in your profits when your income tax is calculated!

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