Starting a Construction Company in the Netherlands
If you’re thinking about starting a construction company in the Netherlands, you’ll need to be aware of the specific legal requirements and regulations that apply to this industry. In this guide, we will explain the best legal structure for your construction company, any permits and contracts you might need, how to recruit staff and workers, and who is allowed to work in the construction industry in the Netherlands. We will also discuss the opportunities and challenges of setting up and running a construction business in the Netherlands.
What is the best legal structure for a construction company in the Netherlands?
There are several options for setting up a construction company in the Netherlands, including a BV (limited liability company), eenmanszaak (sole proprietorship) or VOF (partnership). The best option for your construction company will depend on your business needs and preferences.
In practice, the BV is the most common legal entity for construction businesses. This is because you are not personally liable for the company’s debt and risk. Additionally, a BV has multiple tax advantages that construction companies can make use of.
Finally, when establishing a construction company, you should consider the benefits a Dutch holding structure can give you. We can tell you more about this by email or phone.
Are you interested in setting up a construction business in the Netherlands? Contact us below and receive a free quote.
Do construction companies in the Netherlands need to obtain any permits or licenses?
First of all, if you come from outside the EU, EEA or Switzerland, a work permit is required. There are two types of permits:
- an employment permit (in Dutch: “tewerkstellingsvergunning” or “TWV”)
- a single permit (GVVA), a combined residence and work permit
Furthermore, you should comply with the Working Conditions Regulations in the Netherlands (Arbowet).
Rates, fees and wages in the construction industry in the Netherlands
The construction industry in the Netherlands is highly regulated, so construction workers are typically paid a set wage that is determined by their level of experience and training. In addition, construction workers are typically paid overtime rates for working more than eight hours per day or 40 hours per week.
Wages for employees in the construction industry
The minimum wage in the Netherlands is around €1725 per month. However, construction workers are typically paid a higher wage than the minimum wage. The average hourly wage for starting construction workers in the Netherlands anywhere between the minimum wage of €1725 and circa €2400 per month. After a 3-5 years this salary is usually up €2200 and €3000. This is based on a 38-hour work week. More specialized or otherwise in-demand construction workers can earn substantially more.
Hourly rates construction worker
Self-employed construction workers can charge whatever they want. These fees are not regulated. The difference in fees is determined by the experience, quality and how much demand there is for this specific type of work. Finally, a self-employed construction worker with low overhead costs usually offers a lower tariff than a larger construction firm. Find a few examples below to give you some guidance (ex. vat):
- Carpenter: €25-50 per hour
- Electrician: €45-70 per hour
- Plasterer: €25-40 per hour
- Painter €35-50 per hour
- Mason: €30-40 per hour
- Roofer: €30-45 per hour
Pension in the Dutch construction industry
Employees of a Dutch construction or building firm are often required to take part in a pension fund. This also applies if you are the sole employee of your own firm. As an employers are obliged to join the industry pension fund for the Construction Industry (bpfBOUW). Employees participate in this pension scheme. The rights and obligations of employers and employees are laid down in the relevant collective labour agreement (CAO), which is referred to in the employment agreement.
Contracts for a Dutch construction company
A construction company in the Netherlands should have a number of different contracts in place to protect itself from potential legal disputes and provide clarity to its employees and customers. Some of the most important legal documents a construction company should have include: general terms and conditions, a contractor’s agreement with a customer and an employment contract for all of its employees.
What are the tax implications of starting a construction company in the Netherlands?
If you are a sole proprietorship or partnership, your business income be taxed on your personal income tax. If you have little income, you will pay relatively little tax. But if your company is quite profitable, your taxes will be quite high. There are a few tax breaks for small businesses called zelfstandigenaftrek, startersaftrek and MKB-winstvrijstelling.
| Personal Income Tax (IB) | 2023 | 2024 |
|---|---|---|
| Bracket 1 | 36,93% up to €73.031 | 36,97% up to €75.518 |
| Bracket 2 | 49,50% from €73.031 | 49,50% from €75.518 |
The total tax calcultation on a ‘profit’ (total revenue minus all business expenses of the sole proprietor) of EUR60,000 will look like this:
| ZZP disposable income calculation example | ||
|---|---|---|
| ZZP revenue minus expenses | 60.000 | 60.000 |
| Private business ownership allowance | – 7.153 | |
| SME profit exemption | – 7.399 | |
| Personal income (box 1) | 45.448 | |
| Tax & Premium National Insurance | 17.784 | |
| General tax credit | -1.682 | |
| Personal income tax due | 11.502 | – 11.502 |
| Income-related social healthcare insurance contribution | -2467 | – 2467 |
| Disposable annual income | € 46.031 |
If you set up a limited liability company (BV), you will pay corporate tax on the business profits. This tax is relatively low for small and medium-sized businesses.
| Profit | 2023 | 2024 |
|---|---|---|
| SME tariff | 19% (up to €200.000) | 19% (up to €200.000) |
| Standard tariff | 25,8% (profits exceeding €200.000) | 25,8% (profits exceeding €200.000) |
| Innovation Box | 9% on profits derived from qualifying innovative activities | 9% on profits derived from qualifying innovative activities |
Additionally, businesses must pay value added tax (VAT) on all goods and services they sell. The standard VAT rate in the Netherlands is 21%.
What are the recruitment requirements for construction workers in the Netherlands?
First of all, citizens from the EEA or Switzerland do not need a residence and work permit to work in the Netherlands. However, workers from other countries might need to apply for a residence or work permit. You can find out what kind of permits you or your employee(s) need on the website of the Dutch Immigration Services (IND)
Where do I find construction workers in the Netherlands?
There are several options for finding construction workers in the Netherlands. One option is to recruit workers through a labor brokerage company. These companies are licensed to match employers with employees, and they can help you find workers who meet your requirements. Another option is to use a staffing agency. Staffing agencies are allowed to place construction workers in jobs throughout the Netherlands. Examples are Randstad and USG.
Another option is to look online for workers that are looking for a job. There are several job platforms in the Netherlands where you can post a job, for example Indeed and LinkedIn.
Associations in the Dutch construction sector
There are several trade associations in the construction industry in the Netherlands. These organizations provide support and resources to their members, and they can help construction companies stay up-to-date on the latest industry trends. Some of the most popular trade associations in the construction industry include:
Insurance for construction companies
There are numerous insurance products you can take out. The most common ones for companies in the construction industry are:
- CAR (Construction All Risk). This insurance provides coverage for material damage caused during the construction or assembly of buildings, roads, bridges and installations. For example, due to an error that causes damage to a neighboring building.
- A business liability insurance can protect your construction company from financial damages that may occur as a result of a lawsuit. This type of insurance can help you cover the costs associated with a legal judgement, including court fees, attorney’s fees, and damages.
- A Legal expenses insurance provides legal assistance in conflicts, for example with a customer or supplier. Such as a conflict about a contract or a product / service that you provide.
There are several types of insurance policies available, so it’s important to choose one that meets your needs. Some policies may cover damages caused by accidents, while others may cover damages caused by employees or products. It’s also important to make sure that the policy provides enough coverage to protect your company in the event of a serious lawsuit.
What does it cost to start a construction company in the Netherlands?
There are several costs that you will incur when starting a construction company in the Netherlands. These include registration fees with the Chamber of Commerce, liability insurance, and taxes. The total cost of starting a construction company in the Netherlands typically ranges from €1000 to €3000. For more information, please see our guide on starting a business in the Netherlands. Or check out our Pricing.
How long does it take to start a construction business in the Netherlands
It typically takes between two and four weeks to have your construction business in the Netherlands up and running. This process works as follows:
- Construction company is incorporated at the notary (special lawyer in the Netherlands) takes 5-10 days
- Registration at the chamber of commerce (KvK) takes 24 hours
- Application for VAT number takes 5-10 days on average
- Opening a business bank account takes 1-7 days on average
- Optionally: take out company liability insurance and apply for any permits and licenses
We can help you to properly set up your construction company. Request a free quote below.
