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Dormant company

Once in a while we are being contact by a potential client that has a BV company which is being referred to as a dormant company. We inform the potential client about the costs of processing this BV company. The surprise on the other side is always the same, as it was assumed that the processing of a dormant BV would have been much easier and cheaper.

Dormant companies do not exist in the Netherlands

The problem is that in the above mentioned situation the assumption is that if the BV was not used the full year, that could make the company qualify as being dormant, hence no obligations exist. That might be the case abroad, but in the Netherlands a dormant BV company does not exist.

Dormant company

Court case

Recently al lady went to court as she received an ex officio assessment for the year 2007 and 2008. Moreover a EUR 2.460 fine for not filing the 2009 corporate income tax return was issued. The lady argued in court that nothing happened in the BV company and she was not able to find an accountant that was willing to assist her.

In my opinion she simply was not willing to pay for the services of the accountant, as any charge would have been too much. I believe the expression is ‘Do not play with dogs you cannot run with’. In other words, if cannot pay for the running costs of the BV company or you do not understand what are the obligations of a BV company, stay away from a BV company.

Because nothing happened in the BV company, the lady had not kept any administration. However, she did make a complaint against the ex officio assessments that were imposed for 2007 and 2008. The ex officio assessment is imposed for an amount that is dependent on the mood of the tax inspector that day and only service the purpose of triggering you to comply with the obligations. The moment the lady explained she had not kept any bookkeeping, the court could not decide anything else than that the appeal failed due to lack of proof. The fine of EUR 2.460 for being late which the court often reduces to EUR 500 was also not reduced, as it was clear the lady was not willing to comply with any of the rules.

BV company

It is possible you have a BV company and nothing is happening in that BV company. Either the company holds a participation and no dividends are being paid or it is a true empty company. Nevertheless you need to report the annual report with the Chambers of Commerce and file a corporate income tax return.

Orange Tax Services

We will be glad to assist you with an empty BV company administration. The time spend on bookkeeping is nearly zero and for the annual report and corporate income tax return we maintain fixed fees that you can find on the website. The EUR 2.460 fine mentioned above is of course for the first time, then 50% of the fine is being charge. But if she is late with filing again, 100% of the fine for that year will be issued, being EUR 4.920. Always avoid getting a fine and it is not that difficult to do this. Every time you are asked to file a tax return the deadline is clearly mentioned. Contact us and we will be glad to assist you.

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