A subsidiary in the Netherlands is a regular Dutch company with full legal personality, characterized by the fact that its share capital is fully or partially owned by a foreign company. This distinction is very useful in opposition to a Dutch branch, which is an entity much more linked to the foreign parent company.
| Quick Facts | |
|---|---|
| Applicable legislation (home country/foreign country) | Foreign country |
Best used for | Various types of activities (trading, commerce, IT, services, etc.) |
Minimum share capital | EUR45,000 when created as a public company |
| Time frame for the incorporation (approx.) | 3 – 4 weeks |
| Management (local/foreign) | Local or foreign |
| Legal representative required | No |
| Local bank account | Yes |
| Independence from the parent company | Fully independent legal entity |
| Liability of the parent company | No liability of the parent company on the subsidiary's obligations |
| Corporate tax rate | – 15% (for the first EUR245,000), – EUR36,750 + 25% for amounts of more than EUR245,000 |
| Possibility of hiring local staff | Yes |
The foreign company abroad is able to control its Dutch subsidiary, unlike in the case of the branch, it is not fully liable for its actions, debts, and liabilities in the country. The subsidiary is not limited to performing the same business activities as the parent company; it may register with the relevant authorities to perform more in the country if needed. This, combined with the lack of liability from the foreign company, are two of the most important advantages of the subsidiary.
When establishing a subsidiary in the Netherlands, the founders may choose between two common forms: the private limited liability companies and the public limited liability companies.
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The legal forms of subsidiaries in the Netherlands
The private limited company (the Dutch BV) is a form of business adopted especially by smaller and medium-sized businesses. No mandatory minimum share capital is required by law to incorporate a subsidiary in the Netherlands in the form of a BV company. It can be incorporated with as little as 1 Euro. The share capital must be divided into registered shares, which are non-transferable. The liability of the shareholders is limited by their contribution to the company’s capital, and the management is assured by at least one director. There are many methods for establishing a BV company, methods that ensure the privacy of shareholders and directors, tax minimization, holding structures designed for international businesses, and BV companies owned by other special structures such as Dutch Foundations.
An entrepreneur can also establish a subsidiary in the Netherlands in the form of a public limited company (NV company), which is formed with a minimum share capital of EUR45,000, divided into registered and bearer shares. This type of business can issue a certificate of shares for bearer shares, unlike a private limited liability company. The shares may also be transferable to the public. The liability of the shareholders is also limited by the capital injected into the company. Unlike the private one, the public limited liability company can be listed on the Stock Exchange.
After establishing a subsidiary in the Netherlands, the management must be assured by at least two managers from the board of management. A supervisory body may also be appointed in order to check the management’s activities. Large corporations, usually the NV, will have more demanding requirements for annual accounting, reporting, and auditing.
We have also created an infographic with the procedure of opening a Dutch subsidiary:
The registration procedure of a subsidiary in the Netherlands in 2026
A subsidiary in the Netherlands is registered by taking the first action of opening a bank account where the initial capital is deposited, and a certificate of deposit is issued.
The founders must also make sure that the chosen name is unique and, before registration, it must be checked at the Chamber of Commerce. A confirmation regarding the validity of the name is received through email and, according to that answer, the subsidiary may start the registration process.
A “declaration of non-objection” from the Ministry of Justice must be obtained prior to registration at the Chamber of Commerce, in order to establish a subsidiary in the Netherlands. The investor must submit an application for obtaining a declaration of non-objection, and he must also pay the required fees.
The articles of association, the application for establishing a subsidiary in the Netherlands, and the foundation deeds must be notarized. The documentation mentioned above must then be submitted to the Chamber of Commerce, along with the certificate of deposit and the “declaration of non-objection”.
The procedure of setting up a subsidiary in the Netherlands in 2026 can be explained by our specialists. If you are interested in company incorporation in another region, such as Dubai, we can put you in touch with our local partners from BridgeWest Dubai. More information is available at companyincorporationdubai.com, a reliable online resource.
Documents needed to open a subsidiary in the Netherlands
The following documents are required for registering a subsidiary in the Netherlands:
- information about the parent company, which must include the address in the foreign country;
- an extract issued by the Trade Register in the parent company’s country confirming the existence of the foreign business;
- the articles of association of the subsidiary, which must be notarized by a Dutch public notary;
- a declaration through which a local representative is assigned to the subsidiary;
- the above-mentioned declaration of no objection issued by the Dutch Ministry of Justice.
We can help you with the incorporation procedure of a subsidiary company in the Netherlands.
Subsidiary taxation in the Netherlands
As long as a subsidiary is registered in the Netherlands, it is considered a resident company and it must pay the same corporate tax as any other Dutch company. For this purpose, registration with the tax authorities is mandatory. At the same time, registration at the social security authorities must be performed when hiring employees in the Netherlands.
The Dutch corporate income tax is 25%. Resident companies are taxed on their worldwide income. Because the Netherlands is a member of the European Union, the EU Parent-Subsidiary Directive applies to subsidiaries of foreign companies incorporated here. This directive, together with the double tax treaties signed by the Netherlands and other countries provide important tax benefits and tax relief.
Other taxes for companies in the Netherlands include the real property tax, the social security contribution, and a transfer tax. The tax year is usually the same as the calendar year, and Dutch subsidiaries must observe the accounting and reporting principles. Failure to comply with the existing filing requirements results in penalties and fines.
The Dutch business registration procedure for a subsidiary in the Netherlands is straightforward and lasts for about eight working days.
Licensing requirements for a subsidiary in the Netherlands
Setting up a Dutch subsidiary may require a business license depending on the activities it will undertake. However, you must pay attention to the fact that there are two types of permits available:
- the general ones, that must be obtained from the municipality and other local authorities, and which apply to all businesses with no exception;
- the industry-related ones, which are issued by national authorities, thus requiring specific documentation and even additional paperwork.
If you want to open a subsidiary in the Netherlands and need guidance in navigating through the licensing requirements, our local advisors will help you.
Employment rules
A Dutch subsidiary can hire local employees or transfer people from the home country of the parent company. Apart from the fact that work and residence permits are required for non-EU/EEA workers, the subsidiary will respect the Dutch Employment Law. The main advantage is that both personnel and employers can obtain various tax benefits.
Differences between a subsidiary and a branch office in the Netherlands
Foreign enterprises setting up businesses in the Netherlands can choose between these two legal entities: the branch and the subsidiary. There are several factors to consider when choosing the most appropriate business form. This is why our Dutch company formation specialists have created a brief comparison between them based on the most important aspect to take into account when making a decision:
- legal personality: the subsidiary is a different company from the parent firm, while the branch office depends entirely on the overseas enterprise;
- liability: the subsidiary is liable for its own debts and obligations; however, in the case of a branch, the parent company bears responsibility for them;
- share capital: the subsidiary must abide by the requirements imposed for the selected business form, while for the branch office, there are no minimum financial requisites to comply with;
- taxation: the subsidiary will be treated as a domestic company, while the branch will pay the corporate income tax on the profits it obtains in the Netherlands.
When it comes to the uses of one or the other, there are no restrictions with respect to the industries they can operate in. However, the branch office is often met in well-regulated sectors, as it offers a higher degree of control to the parent company.
Each of them has its own advantages, so you can rely on our company registration consultants in the Netherlands to choose between the branch and the subsidiary.
You can also watch our video on how to open a Dutch subsidiary:
Why open a subsidiary in the Netherlands in 2026?
Foreign companies seeking to set up a business presence in the Netherlands should choose the subsidiary because:
- it can take the form of the most popular business entity in this country – the limited liability company;
- from a taxation point of view, the subsidiary is a tax resident and can benefit from many advantages, such as tax deductions and exemptions;
- it is not bound to the parent company and can undertake different activities suited to the Dutch market;
- the registration process is quite fast and simple (it can take up to 5 days to be completed);
- it does not require a minimum share capital if it is registered as a private limited liability company.
Foreign company owners who want to open companies in the Netherlands in 2026 can direct their attention to subsidiaries if they want to create fully independent businesses. This way, they will be able to adapt their goods or services to the Dutch market in order to increase their revenues.
After a hard year, the economy of the Netherlands is expected to start its recovery in 2026. Setting up a subsidiary here can represent a good option for those who have postponed their plans.
Projections for the Dutch economy
2026 is a good year to open a subsidiary in the Netherlands, as the country’s economy is slowly starting to recover. In comparison to 2024, the Dutch economy is expected to have expanded by 1.7% in 2025 and by 1.3% in 2026 and 2027. Higher consumer expenditure, helped by growing purchasing power, will be the main driver of the Gross Domestic Product growth. Given the additional costs associated with an older population and increased defense budgets, government spending will also be important. In the upcoming years, a small recovery in business investment is anticipated.
It is also expected that unemployment will increase in the upcoming years since the Dutch economy is predicted to develop below its potential. However, inflation will return to normal, falling from a still-high average of 3.0% in 2025 to 2.0% in 2027.
Should you need guidance in setting up a Dutch company, our specialists can assist you.
You can find out more about the procedure of opening a company in the Netherlands by contacting our Dutch agents, who offer company formation and related services. We can also help you open a foundation (stichting) in the Netherlands.