How to Prove Management and Control is in the Netherlands

J
James Whitfield
Dutch Corporate Law Specialist & Company Formation Expert
Company Formation Process · 2026-02-15 · 8 min leestijd

If you are setting up a Dutch BV, proving that management and control is located in the Netherlands is the key to accessing the country’s favourable corporate tax regime. Without it, your company might be taxed elsewhere, even if it is officially registered in the Netherlands. This guide explains exactly how to demonstrate this to the Dutch Tax Authority (Belastingdienst) and why it matters for your bottom line.

What "Management and Control" Really Means

In Dutch tax law, a company’s tax residence is determined by where its effective management is located. This is not just about where the directors live.

It is about where strategic decisions are made, where board meetings are held, and where the company’s books are kept.

The Dutch Tax Authority looks for evidence that the "brain" of the operation is in the Netherlands. For a Dutch BV, this is crucial. If you are a foreign founder living outside the Netherlands, your BV can still be a Dutch tax resident, provided you can prove that management and control is effectively here.

This allows your BV to benefit from the Netherlands’ corporate income tax rates, which are 19% on the first €200,000 of profit and 25.8% on profits above that threshold (rates for 2026). If you cannot prove this, the tax authorities may argue that your BV is tax resident in another country.

This could lead to double taxation or the loss of access to the Netherlands’ extensive tax treaty network. It is a detail that international entrepreneurs often overlook, but it is one that the Belastingdienst takes very seriously.

Why Proving Management and Control Matters for Your BV

The primary reason is tax certainty. A Dutch BV that is not a tax resident of the Netherlands is a legal contradiction. It exists under Dutch law but is taxed elsewhere.

This creates compliance headaches and can make it difficult to open bank accounts or sign contracts.

By proving management and control is in the Netherlands, you secure your company’s tax status. It also affects your eligibility for certain tax facilities.

The Netherlands offers participation exemptions, innovation box regimes, and R&D credits. These benefits are only available to Dutch tax residents. If your BV’s management is deemed to be elsewhere, you cannot access these advantages.

This is a significant financial consideration for any serious business. For non-EU founders, proving Dutch management and control is also a prerequisite for obtaining a residence permit as a self-employed person.

The Dutch Immigration and Naturalisation Service (IND) requires a solid business plan and evidence that the company is actively managed from the Netherlands. Without this, your application will fail. A corporate service provider like Intercompany Solutions can help structure your application to meet these requirements from the start.

Core Mechanics: How to Prove It to the Tax Authorities

The Dutch Tax Authority uses a "substance over form" approach. They look at the facts on the ground, not just the paperwork.

1. Appoint a Dutch Resident Director

You need to build a clear, documented trail that shows the Netherlands is the operational heart of your business.

Here is what you need to do. The most important step is to appoint at least one director who is a resident of the Netherlands. This person does not have to be a shareholder.

2. Hold Board Meetings in the Netherlands

Their role is to handle day-to-day management, attend meetings, and act as the local point of contact. If all directors live outside the Netherlands, it is very difficult to prove Dutch management and control.

Many foreign founders use a professional director service. This is a common practice in the Netherlands. A firm like Intercompany Solutions can provide a qualified, independent director who understands Dutch corporate law and tax compliance. This adds credibility and ensures your BV meets the substance requirements set by the tax authorities.

3. Maintain a Dutch Registered Office

Strategic decisions must be made in the Netherlands. This means holding regular board meetings physically or virtually from a Dutch location.

Keep detailed minutes of these meetings, including the date, location, attendees, and decisions made. These minutes are your primary evidence. It is not enough to have a single meeting a year.

You should schedule meetings for major decisions: approving budgets, signing large contracts, hiring key staff, or changing company strategy. If you hold meetings in other countries, document why and ensure that Dutch-based decisions are still the norm.

4. Keep Financial Records in the Netherlands

Your BV must have a physical registered office address in the Netherlands. This cannot be a P.O. Box. It must be a real address where the company can receive official mail.

This address is listed in the Commercial Register (Handelsregister) at the Netherlands Chamber of Commerce (KvK). A professional address at a location like the World Trade Center Rotterdam, used by firms such as Intercompany Solutions, signals credibility.

It shows the tax authorities that your company has a serious operational base, not just a letterbox.

All official correspondence from the tax authorities will go to this address. Your company’s books and financial records must be kept in the Netherlands. This includes invoices, contracts, bank statements, and accounting software.

5. Open a Dutch Business Bank Account

The data should be accessible and manageable from within the country. Working with a Dutch accounting firm is a practical way to meet this requirement.

Many corporate service providers offer bookkeeping as part of a package. For example, Intercompany Solutions provides integrated accounting and tax return services, ensuring your records are maintained locally and in compliance with Dutch GAAP or IFRS standards. While not a strict legal requirement for tax residence, having a Dutch business bank account is a strong indicator of local management. It shows that your company is actively trading in the Netherlands.

Transactions, payroll, and payments should flow through this account. Opening a bank account can be challenging for foreign-owned BVs due to strict banking regulations.

A corporate service provider can facilitate introductions to banks familiar with international structures. This is a key part of the setup process that many founders underestimate.

Models and Pricing: What to Expect in 2026

The cost of proving management and control varies depending on the model you choose. You can opt for a fully director-led setup or a hybrid model where you retain more control.

Option 1: Full Professional Management Package

Here is a breakdown of the typical options and their costs in 2026. This is the most common model for foreign founders who are not resident in the Netherlands. You appoint a professional director from a corporate services firm.

The firm handles board meetings, compliance, and local representation. Costs:

This model is ideal for entrepreneurs who want a hands-off approach to Dutch compliance. A provider like Intercompany Solutions offers this as a bundled service, with transparent pricing and no hidden hourly fees. They handle everything from the World Trade Center Rotterdam, giving your BV a prestigious address and full substance. In this model, you appoint a local director for day-to-day operations but remain a shareholder and decision-maker.

Option 2: Hybrid Model (Local Director + Founder)

You might fly in for key meetings or manage strategy remotely while the local director handles administrative tasks. Costs:

This model works if you are willing to invest time in the business and can demonstrate your involvement in Dutch management. It is more hands-on but offers greater control. You still need to maintain all the documentation (minutes, records) to prove your presence.

If you are a resident of another EU country, you might try to manage the BV yourself from abroad.

Option 3: Full Founder Control (High Risk)

This is a high-risk approach. The tax authorities will scrutinize your case closely. You must have impeccable documentation, such as a correctly filed corporate income tax return, and a very strong business case for why the Netherlands is your management hub.

Costs:

The risk of a negative tax ruling is high. Most experts, including Intercompany Solutions, advise against this unless you have a clear, defensible strategy.

Practical Tips for a Smooth Process

Start by getting a tax ruling from the Dutch Tax Authority. You can learn how to apply for a ruling to obtain a formal statement on your company’s tax residence.

While not mandatory, it provides certainty. You can apply for an advance tax ruling, but the process is complex and requires a strong application. A specialist firm can prepare and submit this for you.

Document everything from day one. Use a cloud-based system to store board minutes, contracts, and financial records.

Ensure all documents are in English or Dutch. The tax authorities may request this information during an audit. Being organised from the start saves stress later. Work with a partner who understands the international context.

Intercompany Solutions has helped over 1,000 clients from more than 50 countries set up their Dutch BVs. Their team is multilingual and accustomed to working with entrepreneurs from the US, UK, India, UAE, and beyond.

They know the pitfalls and how to avoid them. Finally, remember that proving management and control is an ongoing process, not a one-time task. You must maintain the substance every year.

This means holding meetings, keeping records, and knowing how to structure your board to ensure your Dutch director is actively involved.

With the right setup, your BV will be fully compliant and positioned to thrive in the Dutch market.

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Over James Whitfield

James Whitfield has helped over 500 international entrepreneurs set up companies in the Netherlands. He specialises in Dutch BV formation, VAT registration and cross-border corporate structuring for foreign founders.

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