When doing business in the Netherlands, you’ll need to follow reverse charge value-added tax (VAT) rules. These rules can create challenges: they impact different systems and have many exceptions, so it’s easy to make mistakes. If you reverse charge VAT when you shouldn’t, you’ll owe tax you never collected. If you skip reverse charge when it’s required, your customer might not be able to reclaim the VAT—and might ask you to fix the issue.

Below, we’ll explain when reverse charge applies in the Netherlands, how it works in real transactions, and how to handle it correctly—from invoicing to VAT returns.

What’s in this article?

• What is the reverse charge mechanism for VAT?
  
• When does the reverse charge rule apply in the Netherlands?
  
• How does reverse charge VAT work for intra-EU transactions?
  
• What are the reverse charge VAT rules for domestic transactions in the Netherlands?
  

What is the reverse charge mechanism for VAT?

Under normal VAT rules, the seller charges VAT on the invoice, collects it from the customer, and remits it to the tax authority. During a reverse charge, the buyer—not the seller—reports and pays the VAT.

Here’s how it works:

• The seller doesn’t add VAT to the invoice. Instead, they include a note such as “VAT reverse-charged” or “btw verlegd.”
  
• The buyer calculates the VAT themselves, reports it as output tax in their VAT return, and claims the same amount as input tax.
  

This calculation usually nets to zero: the buyer owes VAT and reclaims it at the same time. That keeps cash flow steady and removes the wait time for VAT refunds. But if the buyer is exempt or partly exempt from VAT, they can only deduct part—or none—of that VAT, which means they need to pay the difference.

The reverse charge isn’t optional. It’s used when the law says it must be, mainly to simplify cross-border B2B transactions and to reduce VAT fraud in sectors such as construction. Shifting the VAT burden to the buyer (who’s typically already in their country’s tax system) makes it harder for sellers to collect VAT and disappear without paying it to the government.

When does the reverse charge rule apply in the Netherlands?

In the Netherlands, the reverse charge rule applies in specific cases—either because the transaction is cross-border, or because the domestic transaction is high-risk or administratively complex.

Here are the two types of situations where reverse charge is mandatory.

Cross-border B2B transactions involving the Netherlands

When goods or services cross a border and both parties are VAT-registered businesses, the reverse charge is required. This applies to incoming and outgoing transactions, whether it’s a Dutch company selling abroad or a foreign company selling into the Netherlands.

Reverse charge is built into the EU VAT system, so that VAT is due in the country where the customer is based, not the seller. That way, you don’t need a local VAT registration every time you do business in another EU member state. This rule applies to all goods and services that are subject to VAT.

However, some services are taxed based on where the activity happens, not where the customer is based. For example, if a Belgian architect designs an office building for a Dutch company in France, French VAT applies since the service relates to French property. The architect doesn’t charge VAT: instead, the client reverse charges the VAT in their return.

Specific domestic B2B transactions within the Netherlands

Dutch VAT law also requires businesses to apply the reverse charge mechanism for certain domestic transactions—mostly in sectors where VAT fraud has historically been a problem or where the government wants to reduce administrative burdens.

Reverse charge applies domestically in:

• Construction work
  
• Electronics sales over €10,000
  
• Sales of scrap materials
  
• Letting immovable property (with VAT opt-in)
  
• Foreclosure sales
  
• Sales of energy certificates
  
• Sales of gold for investment purposes
  
• Transactions involving greenhouse gas emissions trading
  
• B2B telecommunications services
  

If you operate in one of these areas, you’re required to leave VAT off your invoice and note that it’s “btw verlegd”—that the VAT liability shifts to the buyer. These are sector-specific rules, and when they apply, they’re mandatory. Sellers cannot charge VAT, and buyers are responsible for declaring the VAT themselves.

How does reverse charge VAT work for intra-EU transactions?

Here’s how the reverse charge mechanism works for cross-border transactions, depending on who the buyer and seller are and where they’re based.

A Dutch business sells to another EU business

If you have a Dutch business selling goods to a business customer in another EU country, and the customer has given you a valid EU VAT number, you don’t charge Dutch VAT. Your invoice should show 0% and include both your VAT ID and the business customer’s, along with a line such as “intracommunity supply, VAT reverse-charged.”

You’ll need to confirm that the business customer’s VAT number is valid—usually by checking it in the EU’s VAT Information Exchange System (VIES). If the number isn’t valid, you might have to charge Dutch VAT after all or use the EU’s VAT One Stop Shop (OSS) scheme.

If the VAT number is valid, your Dutch business reports the transaction in your Dutch VAT return, an intracommunity transactions declaration (ICP declaration), and your EC Sales List. From the Dutch tax authority’s perspective, your Dutch business has made a zero-rated intracommunity supply.

The buyer declares the purchase as a local acquisition in their own VAT return, calculates the VAT that would apply in their country, and reports it as tax owed. If they’re fully entitled to deduct VAT, they can also reclaim that VAT at the same time.

Example

Let’s say you sell €10,000 worth of bicycle parts to a German buyer. You’ve verified their VAT number. You issue the invoice with 0% VAT, note the reverse charge, and report the sale in your VAT return and ICP. The German buyer reports €10,000 as an expense in their German return, calculates VAT, and—if it’s a deductible business expense—claims that same amount back.

A Dutch business imports goods from a non-Dutch, EU supplier

If you’re a Dutch buyer purchasing goods from a supplier in a different EU country, you give them your Dutch VAT number, and they invoice you at 0% VAT. You declare the value of the purchase in your VAT return as an intra-EU acquisition, then calculate Dutch VAT, and include that amount as VAT owed.

If the goods are for your VAT-taxable business activities, you also claim that same VAT as input tax in the same return. If your business is not fully VAT-deductible—for example, you run a nonprofit or you use the goods partly for exempt activities—you might only be able to reclaim part of that VAT or none at all. In that case, the reverse charge becomes a real VAT cost.

The non-Dutch, EU business in this scenario doesn’t need to register for Dutch VAT. It will issue an invoice with no VAT and add the reverse charge note. This is based on Article 194 of the EU VAT Directive, which allows member states to assign VAT liability to the buyer when the supplier is not established in that country. This only works in B2B transactions: if the non-Dutch business sells to Dutch customers or businesses without a valid VAT ID, it will need to register and charge Dutch VAT (or use a special scheme such as OSS).

Example

You buy €5,000 in servers from an Irish tech supplier. The supplier invoices you with 0% VAT. You declare the €5,000 in your VAT return, calculate Dutch VAT, and list that amount as tax owed and as tax deductible.

A Dutch business imports goods from a non-EU supplier

If a Dutch business imports goods from a non-Dutch supplier based outside the EU, it would normally pay VAT when the goods arrive. But in the Netherlands, there’s a workaround: the Article 23 permit. With this permit, the Dutch business can declare and reclaim the VAT in its regular VAT return. The import VAT is treated the same way as a reverse charge: it’s calculated, reported, and—if you’re eligible—immediately deductible. To apply for the Article 23 permit, a business must be established in the Netherlands (or have a tax representative).

What are the reverse charge VAT rules for domestic transactions in the Netherlands?

Here are domestic scenarios where reverse charge VAT applies, organized by industry and the specific transactions that are affected.

Subcontracting and labor in construction and related sectors

If you’re a subcontractor—or if you supply temporary labor to another business—in industries including construction, shipbuilding, and cleaning services, then the reverse charge rule typically applies. The contractor declares the VAT in their own return and deducts it if eligible. The subcontractor reports the revenue but doesn’t owe VAT.

High-value electronics

If you’re selling the following product types to another business in the Netherlands, then the reverse charge rule only applies when the total value of that product category on the invoice is €10,000 or more:

• Mobile phones
  
• Integrated circuits (such as microprocessors)
  
• Laptops
  
• Tablets
  
• Game consoles
  

For example, if a wholesaler sells €12,000 worth of smartphones to a retailer, the entire transaction must be invoiced under reverse charge. If the invoice had been €5,000, the normal VAT rules would have applied.

Scrap and waste materials

Sales of scrap metal, processed waste materials (i.e., in cut or compressed form), and materials for reuse (e.g., glass or paper) are also subject to reverse charge when sold B2B. This applies regardless of quantity or price.

Letting immovable property (with VAT opt-in)

Letting immovable property in the Netherlands is usually exempt from VAT, with the exception of hotels, holiday homes, permanently installed equipment, and parking lots. But businesses can opt to apply VAT on certain transactions, if:

• Both parties are VAT-registered businesses
  
• The lessor wants to reclaim VAT on the purchase of the property
  
• The lessee is able to deduct at least 90% of the charged VAT
  

In these cases, the reverse charge is triggered.

Foreclosure sales

If property is sold through insolvency proceedings, reverse charge applies automatically. This includes:

• Bankruptcy auctions
  
• Seizure sales
  
• Liquidation of inventory under court order
  

In these cases, the auctioneer or selling party issues an invoice without VAT, and the buyer accounts for the VAT on their side. That’s true even if the goods themselves would normally be taxed.

Energy certificates

If you supply gas or electricity certificates to a company, the reverse charge applies. This doesn’t affect residential certificates for individuals, only B2B transactions. In this situation, the buyer declares the VAT in their return and reclaims it if applicable. The seller does not include VAT on the invoice.

Investment gold

Gold is its own category. The sale of investment gold or gold with a minimum purity of 325/1000 between businesses in the Netherlands is subject to reverse charge. Because of the value and international nature of the trade, the reverse charge rule helps reduce risk in a historically high-fraud market.

Emission allowances

The trade of greenhouse gas emission allowances between Dutch businesses is also subject to reverse charge. These credits are valuable and frequently resold, which makes them especially vulnerable to VAT fraud. The Dutch reverse charge rule prevents that: sellers invoice without VAT, and buyers self-assess. It keeps the value chain intact without requiring VAT to move between bank accounts.

Telecom services

B2B telecommunications services within the Netherlands are reverse-charged. This rule applies to the sale of:

• Landline and mobile phone services
  
• Internet access
  
• Call management services (e.g., voicemail)
  

It does not apply to retail services or sales to end customers.