Law Changes 2021: Businesses and Entrepreneurship

The Dutch government will implement over 60 new rules, regulations, and law changes at the stroke of midnight on January 1. Below is a summary of the 2021 changes made in the category Entrepreneurship:

The first corporate income tax rate of 16.5 percent, levied on the first 200 thousand euros of income, will fall to 15 percent. That lower rate will now apply to the first 245 thousand euros of income, before the upper rate of 25 percent applies.

Small businesses with fewer than 25 employees can apply for compensation to assist with severance payments in situations where the employer dies or retires. A similar scheme is being developed for when the owner falls seriously ill, forcing the business to close.

The self-employed workers deduction will fall from 7,030 euros to 6,670. This tax benefit will continue to fall gradually through the year 2036, when it hits 3,240 euros.

Plans to force self-employed people to establish a minimum rate in 2021 were scrapped.

The temporary tax measures put in place to help business owners because of the coronavirus pandemic, like permissible delays in making certain payments to the tax authorities, have been extended into 2021.

Training provided by an employer to current and former employees will no longer be subject to payroll tax.

Businesses which pay corporate tax or income tax, and with wage earning staff, will be able to take advantage of new tax credits when they invest in certain assets, like equipment and machinery.

It will be more difficult for businesses to offset previous losses against future profits.

Big businesses will have to pay tax on money received from abroad for interest, licensing and royalties.

Companies earning revenue from specific innovative activities when using the WBSO scheme for research and development will apply a nine percent tax on the profits of those activities. That is up from seven percent, but still remains well below the normal corporate income tax rates.

Corporations which make job-related investments will qualify for a payroll tax discount over the next two years, as part of a plan to incentivize investment during and after the coronavirus pandemic.

The new HFW law will make it easier for businesses to enter into debt restructuring deals with creditors when they face the prospect of filing for bankruptcy. Entrepreneurs will have more ability under the HFW law to go to court to delay payment to creditors in order to continue running their businesses.

Large industrial businesses will face a carbon dioxide emissions cap for which they will pay a tax on the excess.

Potential franchise buyers must be given more accurate information before signing a contract to close the purchase. Franchisees will also get more input into changes made by the franchisors, and a majority of franchise holders must agree to major changes.

Tobacco products may longer be placed on display at filling stations and night shops, and tobacco-related advertising will be prohibited inside and outside specialist tobacco shops.