How it works
In a holding structure the DGA is employed by the holding, and the holding lends the DGA to the operating company. The operating company pays the holding for that: the management fee. A management agreement between the two companies sets the amount, the hours and the notice period.
The fee must be at arm’s length, the price two independent parties would agree. In practice it covers the salary, the employer costs, a pension contribution and a margin. The operating company deducts the fee from its profit; the holding pays the salary from it and is taxed on what remains.
The fee is a service between two companies, so the holding invoices it with VAT. The operating company deducts that VAT when it makes taxed supplies itself. Between companies in a VAT fiscal unity the invoice is free of VAT.
A fee far above the salary takes profit out of the operating company and puts it in the holding. The tax authority looks at that in an audit, so the amount needs a reason: hours, responsibility and the market rate for the role.
Example
The holding employs the DGA at €58,000. Employer costs and pension add €12,000. The holding charges the operating company a management fee of €84,000 a year plus VAT. The operating company deducts €84,000; the holding pays €70,000 in salary and costs and keeps €14,000 as profit, taxed at 19%.
The figures
All 2026 figures: Netherlands tax rates 2026 · the 2027 figures: Netherlands tax rates 2027.
Questions people ask
Is a written management agreement required?
Yes. The agreement is the proof that the fee is a real service at a real price, and the first document an auditor asks for.
Can the fee change every year?
Yes, as long as the change follows the work and the market. Many owners set the fee once a year together with the salary decision.
Holdwise, Hoofddorp. Definition and explanation maintained with the Dutch and German glossaries; figures from the central rates source, year 2026. Updated 16 September 2026.
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