The tax return

The IRS likes to know about the ins and outs of your business. You provide them with the information they need to do this through your tax return. You will have to file these returns quarterly (or monthly) and annually. You are required to do this and if you don't do it you will soon get blue letters with fines. They are quite strict about this, so pay close attention to the deadlines for it. So always make sure you keep clear and complete records.

Income tax return

Income tax returns are familiar to most people. Every Dutch person files these before May 1 of the year following the year for which you are filing your tax return. Are you an entrepreneur? Then the income tax return can look slightly different and more complicated than other forms of tax return. You will have to show how much profit you made last year and how this came about. There are also regulations for when you have made investments. Once you have entered all the data, the tax return program automatically applies all the regulations to which you are entitled. Quite handy. Eventually, two amounts will appear at the bottom. One for the income tax you owe and one for the health insurance premiums One of the most difficult things about income tax is that you only know afterwards exactly what you have to pay. That means you have to keep money in reserve for a long time. So it can be advisable to make an estimate in advance of what you expect to earn. The tax authorities will then send you a preliminary assessment, which you can use to pay the income tax owed in advance or even monthly during the year.

Sales tax return / VAT

If you are liable for VAT, you are obliged to charge 0%, 9% or 21% VAT on all your invoices in addition to the amount you yourself receive. This must be clearly stated on your invoices. What percentage you must charge depends on the type of service or product you provide. Read more in our article on working with VAT. In the month after each quarter you must file a sales tax return, also known as the VAT return. This is actually a very simple return. You simply add up all the VAT you have received and subtract all the VAT you have paid. You pay the difference to the tax authorities. There may well be a quarter in which you have more expenses than income (and therefore paid more VAT than you collected). In that case, you get a refund.

Wage declaration

Suppose you employ or hire someone, you also have to deal with the payroll tax return. This shows how much you pay the employee in gross and net wages. Based on that, the amount you are allowed to remit in payroll taxes is also paid.

If, from your expertise, you yourself have knowledge that would fit the subject of tax returns, or if you see opportunities to improve this text, we look forward to receiving your message at info@cultuuracademy.nl.