The one man company bookkeeping is not much different than other bookkeeping. Balance needs to balance. That said, there are some differences.
One man company bookkeeping
The one man company bookkeeping is the bookkeeping of a company. The one man company equals a ZZP company or freelance company. The Dutch tax office can demand to have access in a two week period to the entire bookkeeping. This implies, the bookkeeping needs to be accessible at all times and understandable.
Bookkeeping is bookkeeping
Bookkeeping is bookkeeping which implies the balance needs to balance and the profit and loss account shows the result. This is not different from the bookkeeping of a Dutch BV company or UK ltd company.
What makes the one man company bookkeeping different?
The one man or one woman makes the bookkeeping different. The Dutch tax office only accpts invoices in name of the Dutch BV. With the one man company the person owning the company can be invoiced or this person can be invoiced in the company name. Both invoices are accepted as costs for the company.
With a Dutch BV company the bank account that only can be used, is the bank account in name of the BV company. With the one man company a personal bank account can be used as well. Not ideal, but possible.
With a Dutch BV company an annual report needs to be created that needs to be published after the shareholders meeting agreed with the annual report. With the one man company no separate document as annual report is required. Using the opportunities in the income tax return to provide a balance and profit and loss are sufficient.
Are these true differences?
Depends who you ask, but these are true differences. The one man company bookkeeping is less formal. This is not the same as less important. The result needs to be correctly reported in the income tax return.
The less formal part makes your life as entrepreneur easier.
The bank account we like to address. Indeed, you can use your personal bank account for the one man company, but we do not recommend that. The Dutch tax office needs to be able to easy access your bookkeeping and we need to facilitate this. If we are then confronted with all your private spending of which sometimes this could be too much information.
The personal bank account can only be in your personal name (initials and last name), the business bank account can be in your company name. This is more professional. Indeed, the bank charges are higher.
Tax wise a difference in accounting?
Tax wise there is no difference in the accounting principles for the one man company or for the BV company. The BV company use the identical rules and regulations.
Tax is exciting
We think tax is exciting. We also are excited about less formal rules for the one man company bookkeeping. It does happen that sometimes you pay an invoice addressed to you personally, not in the business name. Sometimes you pay business costs from your personal account instead of business account. This has no impact, also not if the other way around.