Change sole proprietorship to bv

Are you considering switching from your Dutch sole proprietorship to a bv? Find out how we can guide you through this important step, offering expert advice and personal support for a smooth transition.

Why convert a sole proprietorship to a bv?

There are several reasons for converting a sole proprietorship to a bv (besloten vennootschap), depending on the entrepreneur's specific situation and business objectives. Some of the reasons why a person might choose to convert a sole proprietorship to a bv are:

Limited liability

As the owner of a sole proprietorship, you are personally liable for all debts and liabilities of the company. By switching to a bv, liability is limited to the capital contributed, which means personal assets are better protected in case of bankruptcy or legal disputes.

Tax benefits

In some cases, the tax rate for a bv may be more beneficial than that for a sole proprietorship.

Professionalism

Having a bv can have a more professional appearance than a sole proprietorship. For some entrepreneurs, this can help attract customers, partners and investors, as it gives the impression of an established and solid business.

Growth and investments

If you plan to grow and attract investments, having a besloten vennootschap may be more attractive. Investors are often more inclined to invest in a bv because of the clearer structure and rules involved.

Succession planning

Transferring a bv to a new owner or arranging the transfer to heirs can be easier than with a sole proprietorship, because of the clear shareholder structure and transfer options inherent in a besloten vennootschap.

	Sole proprietorship (or general partnership)	Besloten vennootschap (bv) in the Netherlands
Founding	Registration in the CoC	Notarial deed of incorporation + registration in the CoC
Property	Personal	Shareholders
Legal act	Owner (or partners)	Board/director
Liability	Risk private liability	Shielded private assets
Tax	Mandatory	Payroll tax, sales tax, corporate income tax and dividend tax
Financial annual report	N/A	Mandatory
Participation in other companies	N/A	Yes, the bv can hold shares in other companies

The difference between a sole proprietorship and bv

There are many differences between the various legal forms. The besloten vennootschap (bv) is a Dutch legal form with legal personality, which means that directors are not liable with their private assets for any business debts. The bv can therefore assume obligations completely independently. The sole proprietorship has no separate legal personality and therefore no separate assets.

A transfer of assets subject to tax

With a transfer of assets subject to tax, the company is sold to the bv, as it were. The assets and liabilities of the sole proprietorship must be sold for a fair value. If the assets represent a capital gain above the book value, this can be taxed. For tax purposes, this results in the business being discontinued. The cessation profit is taxed in income tax.

If you convert your sole proprietorship to a bv with a transfer of assets subjet to tax before March 31 this year, you will still retain the option to avail of the current year's tax scheme.

A transfer of assets subject to tax-free

In the silent variant of contribution to a bv, the bv takes over the book values of the sole proprietorship (or VOF) and the company is continued (without cessation). In contrast to the no-closing variant, no cessation profit arises and no tax payments are made. Hence the designation 'silent continuation' that is often used.

The silent contribution has advantages when the sole proprietorship has a lot of hidden reserves or goodwill which means there can be a lot of cessation profit when the assets and liabilities have to be transferred for a fair value but the book value is low. Goodwill is not something you get straight from the figures. Consider the value of the customer base or the good name of your business. We can help determine the tax value of your company's goodwill. This variant also has an important limitation that the shares of the bv may not be sold in the first three years.

If you want to make use of the silent contribution, you must have sent the declaration of intent to the tax authorities before 1 October of the year in question. If you have done this on time, you have until 1 April of the following year to convert your company to bv.

Asset-liability transaction

In the asset-liability transaction, part of the assets (such as inventory, stocks, machinery, debtors) and liabilities (such as equity, creditors, debts) are acquired at book value during the conversion. This offers advantages such as selectively transferring assets and minimising risks for the buyer. Disadvantages include the need for consent for contract acquisition and possible remaining liabilities for the seller. An advisor can help with the valuation and guide the process.

Three ways of converting sole proprietorship to bv

There are three variants for the tax contribution of a conversion, namely: the passive contribution, the silent contribution and the asset-liability transaction.

Consultancy fee conversion of sole proprietorship into a bv

In 10 clear steps, we guide you through the process of converting a sole proprietorship into a besloten vennootschap (bv). We carry out the first 3 steps for a fixed amount starting from € 1,500 excl. 21% VAT, assuming a single-person company (sole proprietorship).

“If there is any one secret of success, it lies in the ability to get the other person’s point of view and see things from that person’s angle as well as from your own.” – Henry Ford

Frequently asked questions about conversion of sole proprietorship to bv

Find here the answers to frequently asked questions by self-employed people about converting a sole proprietorship into a bv.

How much does it cost to go from sole proprietorship to bv?

This depends on the desired guidance. We carry out the first 3 steps (introductory meeting, stock-taking of the figures, analysis of the conversion test and advisory memo bv) for a fixed amount starting from € 1,500 excl. 21% VAT, whereby we assume that it concerns a single company (sole proprietorship). If you would like us to supervise the entire conversion, please contact us for a quotation.

How much do you need to turn over for a bv?

Because taxes change every year, the turning point also changes. In 2024, the turning point is around a profit of €80,000 a year. However, this depends on different circumstances and is not the same for every sole trader. Therefore, get proper advice on this.

Which is more advantageous a sole proprietorship or besloten vennootschap (bv)?

This depends on several factors. Consider the expected profit, possible investments, nature of the activities, etc. Want to know what is most advantageous for you? Then get in touch with us.

Which is better a bv or sole proprietorship?

This depends on several factors, including the entrepreneur's income, expected profit, the nature of the business' activities and the entrepreneur's personal situation and more.

What our customers say about us

Read more about the experiences of (self-employed) entrepreneurs with us.

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Léonie van Mook

16:53 29 Mar 23

Huge help with my tax return by Sandra from Belastingadviseur Eindhoven. She gave me good advice, was knowledgeable and acted quickly. I would therefore recommend Belastingadviseur Eindhoven to anyone.

Ljubomir Stojanovikj

10:21 29 Mar 23

A pleasant cooperation with Roy van der Wiel, very accurate and professional in carrying out his legal support, definitely recommended.

Mike Martens

08:20 07 Sep 21

I am very satisfied with the excellent service provided by this firm. They really have all the expertise to help you as an entrepreneur in all areas. This is nice because you only need one office that way. You can come to them for bookkeeping, tax advice, strategic advice and legal advice. They also really think along with you and make sure you get the most out of your business. Furthermore, it is a very nice team to have contact with. Jan, Sylvia, Roy and André are really great. This office really comes highly recommended.

Pepijn Tielemans

07:36 03 May 21

Expectations have been exceeded. Have received a lot of advice before but it was never picked up, sorted out and processed so quickly. I have also recommended them to anyone in my network who is now not completely satisfied with their current advisers.

A. P

16:25 31 Dec 19

I recently went here to arrange tax matters. I was helped with great patience by Mr Martens and Mr van der Wiel. I was immensely surprised by their empathy and listening ear. They not only look at what you come for but also look at the social and societal side of the problems the client comes to them for. Much respect for these gentlemen! I highly recommend this consultancy!

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Do you think you are ready to bring your company into a bv and do not know where to start? Then contact us.