Since 1 January 2025, the small business scheme (KOR) has been extended to include the EU KOR scheme. This allows entrepreneurs from the Netherlands to get VAT exemption in other EU countries without having to apply for a separate VAT registration there. This is especially interesting for companies that sell internationally but do not want to be stuck with complex VAT returns in different countries.
Who can make use of the EU KOR?
Not every company is eligible. You must meet four key conditions:
- Your company is based in the Netherlands.
- Your total annual turnover within the entire EU shall not exceed €100.000 (the Union turnover threshold). If you go over this, you must opt out of the EU KOR.
- Your turnover in an individual EU country must be below the national turnover limit remain. Each country determines this limit itself, with a maximum of €85.000.
- You are not participating in the import scheme.
Example
Suppose you have a webshop in the Netherlands and sell products to consumers in Austria and Germany. Do you want to use the EU-KOR in one of these countries? Then you first need to find out what the turnover limit there is. If your turnover in that country is below the limit, you can get VAT exemption there through the EU-KOR.
Please note that if you supply to companies with a VAT number in another EU country, you will invoice with 0% VAT. In that case, you cannot use the EU KOR in that country.
How does the EU KOR work in practice?
When you use the EU KOR, you need to be in the countries where you apply the scheme:
- No VAT to charge customers;
- No need to file a local VAT return or have VAT registration.
- No VAT to pay to that country's tax authorities.
At the same time, this also means that you cannot reclaim VAT on expenses you incur there. In addition, you are required to submit quarterly statement of quarterly turnover to file with the Dutch Tax Authorities. In this, you enter the turnover you have achieved in the EU.
Distance sales and the EU KOR
Do you sell through your webshop to consumers in other EU countries? Then, in addition to the EU-KOR, the scheme for distance sales.
The EU has a threshold amount of €10,000 per year set for distance sales. This amount applies to all sales to consumers within the EU, excluding your sales in the Netherlands.
- Staying under €10,000? Then you can just charge Dutch VAT.
- Will you go over €10,000? Then you have to apply the VAT of the customer's country and register there or make a VAT declaration through the Union scheme or EU KOR.
What does this mean for your webshop?
A webshop in the Netherlands sells annually €8,000 to Dutch customers and €6,000 to French customers. As the total intra-EU turnover remains below the €10,000 threshold, Dutch VAT may be applied and everything remains below the KOR limit. In this case, the EU KOR is not necessary.
However, if turnover in another EU country, such as Belgium, is €15,000 amounts, you exceed the threshold and have to calculate the Belgian VAT rate. In that case, you can choose:
- A Belgian VAT registration and declaration in Belgium;
- The Union scheme through the Dutch Tax Administration;
- The EU KOR, provided you stay below Belgium's national turnover limit.
Is the EU KOR something for your business?
The EU KOR is particularly useful for entrepreneurs who sell internationally but do not want to arrange VAT registrations in other countries. The scheme saves administrative burdens, but also has drawbacks. For example, you cannot reclaim VAT on expenses abroad.
Do you want to take advantage of this? Then check whether you meet the conditions and whether it is the most favourable option for your type of business. If you often buy from abroad or exceed turnover limits, a different VAT scheme may be a better fit.
Making smart use of the EU KOR can make your international sales a lot easier!
