The old rule of thumb: around €100,000 to €130,000 in profit, a BV (the Dutch private limited company) becomes more tax-efficient than a sole proprietorship (eenmanszaak). That rule doesn't account for what's coming under the 2027 tax plans. A shrinking self-employed deduction and a possibly-disappearing starter deduction are pushing that tipping point toward a lower profit level than it used to sit at.
Why the tipping point is moving
The choice between a sole proprietorship and a BV comes down to one comparison: what you keep as a sole proprietor after income tax and entrepreneur deductions, versus what you keep as a director-shareholder (DGA) after corporate tax and dividend tax. Every deduction that shrinks on the sole-proprietorship side shifts that balance.
- Self-employed deduction (zelfstandigenaftrek) drops from €2,470 (2025) to €900 (2027): less deductible as a sole proprietor.
- Starter deduction may disappear entirely from 2027: even less for anyone who started recently.
- SME profit exemption (MKB-winstvrijstelling) is expected to stay at 12.7%, but can't offset that loss on its own.
On the BV side, rates are unchanged for now: 19% corporate tax up to €200,000 in profit, 25.8% above that, and a two-bracket dividend tax of 24.5% (up to €68,843) and 31% above that when you take dividends out.
What this actually means
With a smaller self-employed deduction, you pay tax on a larger share of your profit sooner as a sole proprietor. That makes the BV route, with its fixed corporate tax rates, relatively more attractive at a lower profit level than it was a few years ago. Where the tipping point sits exactly depends heavily on your own situation: your intended director's salary, whether you leave profit in the company or pay it out, and what other deductions apply to you. A one-size-fits-all rule of thumb doesn't really hold anymore.
Don't switch on impulse
Setting up a BV comes with its own downsides: more administrative obligations, a mandatory "customary salary" (gebruikelijk loon) as a director, and less flexibility to withdraw profit without triggering tax. The shift in the tipping point is a reason to run the numbers again, not a reason to switch automatically.
New to the Netherlands and unsure which structure fits?
At Sophy &Co. we help expat founders work through this before you've committed to anything. Book a call, no Dutch required, and we can also connect you with our network of trusted partners, banks, lawyers, notaries, and other expats who've already made this same decision.
We're a woman-led, diverse team, both women and men, and proudly LGBTQIA-friendly, speaking English, Dutch, Italian, Chinese, Spanish, Papiamento, German, and some French and Polish between us.
How we look at this with you
At Sophy &Co. we run the actual numbers, including the 2027 changes, against your specific situation. Not a general rule of thumb, but your own profit, costs, and plans as the starting point.
Not sure which structure is right for you?
Want a first indication before booking an advice call? Our sole proprietorship vs BV checker shows which side comes out ahead based on your own profit and situation. Check our services and pricing, read how it works, or get in touch for a no-obligation conversation about whether a BV is already worth it for you. Wondering about your annual accounts once you do make the switch? We handle that too.
Want the official rules? Check the Belastingdienst or the KVK's comparison (Dutch).