Tax return for companies and entrepreneurs
Companies pay tax differently than individuals. Which ones apply to your company depends on the nature of your work and the legal form of your company.
For example, it works a little differently for service providers than for entrepreneurs who sell and buy products. And for sole proprietorships, the rules and options are different than a limited liability company or limited liability company.
One thing applies to all entrepreneurs: it is always a legal obligation to keep accounts and submit a tax return. It is also important that you pay tax on time, otherwise you may be fined.
Are you a company for the tax authorities?
First of all, you must take into account whether the Tax Office sees you as a business. There is a requirement for that. Does the tax authorities not see you as a business? You then enter your income as ‘income from other activities’.
Are you an entrepreneur for the tax authorities? Then you must take into account the following types of taxes.
Sales tax (VAT)
Sales tax or VAT (Value Added Tax) is the type of tax that you will most likely have to deal with. VAT is a real consumer tax: it is passed on to the end user.
As a company, you do not have to pay VAT. You collect the VAT from the customer, the customer pays the VAT to you, and you pay it back to the tax authorities. Never forget to put the VAT on the invoice, otherwise you will pay it out of your own pocket.
It works the other way around. Did you buy something for your business that you had to pay VAT on? Thinking of a new laptop, tablet or even just a notepad or pencil? Then you request this tax back from you VAT declaration. After all, you are not a consumer. Tip: try ours free online tax calculator once out.
Don’t have a sole proprietorship or partnership? Then another tax comes into play: corporation tax. You arrange this tax before income tax.
Corporation tax is calculated for legal forms bv, nv and cooperative. From a tax point of view, this type of company works a little differently than a sole proprietorship.
Is your company liable for tax? Then we recommend that you hire a bookkeeper. He knows exactly what to take into account. You must know this, for example, when you pay dividends to the shareholders there dividend tax coming to see.
Entrepreneurs also pay payroll tax. You set aside part of your ‘salary’ for this. The golden rule that many freelancers and entrepreneurs adhere to is at least 50%. When you work for an employer, this portion is already withheld for you and you won’t see it in your bank account.
In this area, the entrepreneur is expected to take a slightly more proactive stance: You indicate to the tax authorities how much you have to pay and ensure that the payment is actually made on time. Are you curious about how much income tax you have to pay as a self-employed person? Then use our self-employed income tax calculator tool.
As an entrepreneur, there are various benefits for income tax, such as tax deductions and exemptions. To take advantage of this, you are often stuck with one hours criterion. Do you have a very low turnover? Then maybe you can use small business scheme (KOR). In some cases you can move the VAT as well to the customer, for example when you shop abroad.
The tax authorities charge dividend tax on the proceeds of shares and profit certificates. For several years, this rate has been 15 percent of that turnover. A company that pays dividends is obliged to withhold the dividend tax and pay it to the tax authorities.
Payroll tax and national insurance contributions
Do you hire employees? Then you have to deal with payroll tax and national insurance contributions. Together these form payroll tax. As an employer, you must withhold this payroll tax from the employee’s salary.
Tip: Outsource your tax affairs and save money
Did you know that 70 percent of entrepreneurs don’t use all of their deductions? As a result, billions of euros remain with the tax authorities every year. With the help of a tax advisor, you can be sure that you get all the benefits and that you don’t leave any money behind. Via De Zaak you will find a reliable expert in your area.