How it works
A sole trader pays income tax in box 1 on the whole profit, after the self-employed deduction and the SME profit exemption. A BV pays corporate income tax on its profit, and the owner pays box 1 on the salary and box 2 on the dividend. At low profit the sole trader pays less. At higher profit the BV pays less. The profit level where both are equal is the break-even point.
The point changes with two choices. Profit that stays in the BV is taxed only at 19%, so the more the owner reinvests or saves in the company, the lower the break-even point. A high salary pushes it up, because salary is taxed like employment income.
The costs of a BV count too: the annual accounts, the payroll for the DGA and the corporate tax return. Holdwise sets those at about €2,900 a year for a holding with an operating company and includes them in the benchmark.
The Holdwise Threshold is the yearly benchmark for this point. For 2026 the BV with holding beats the sole proprietorship from about €78,000 to €88,000 profit when the profit stays in the holding, and from about €128,000 to €147,000 when everything is paid out privately.
Example
A consultant makes €110,000 profit and needs €60,000 to live on. As a sole trader she pays income tax on the whole €110,000. With a holding and an operating company she pays herself €58,000, the company pays 19% on the rest and the remaining profit stays in the holding. Her total tax bill is several thousand euros lower, and the difference grows every year the profit stays inside.
The figures
All 2026 figures: Netherlands tax rates 2026 · the 2027 figures: Netherlands tax rates 2027.
Questions people ask
Does the break-even point change in 2027?
The self-employed deduction falls to €900 and the starter’s deduction to €10, which lowers the point. The 2027 benchmark follows once the Tax Plan is law.
Is tax the only reason to choose a BV?
Liability, a sale later on, investors and an international customer that requires a company are reasons that count before the tax difference. Many founders choose the BV below the break-even point for those reasons.
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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