Fiscal Representation (also called Tax Representation or Fiscal Representative) is when a locally established Dutch company is officially appointed to handle your VAT obligations in the Netherlands on your behalf. It’s especially important for foreign businesses (EU or non-EU) that don’t have a physical office or legal entity in the Netherlands.

Section 23 (also called Article 23 or the Article 23 permit) is a Dutch rule that lets approved businesses defer import VAT on goods coming from outside the EU. Instead of paying the VAT in cash at customs, you report it on your regular periodic VAT return (monthly or quarterly) using the reverse-charge mechanism. You declare the VAT as output tax and deduct it as input tax in the same return — usually resulting in net zero cash payment.

Under normal rules, you pay import VAT to customs immediately. With Article 23, the VAT obligation is shifted (reversed) from the customs payment moment to your own VAT return. You become responsible for self-assessing the VAT. Because you can normally deduct it fully as a business expense, the amounts cancel each other out. This turns a real cash outflow into simple bookkeeping.

Foreign businesses can use it via a fiscal/tax representative in the Netherlands. You must import goods regularly (not one-off shipments). You need proper records showing the import VAT amounts clearly. You generally file VAT returns monthly or quarterly.

Major cash flow improvement — no tying up money in VAT at customs. Faster customs clearance. You still pay any customs duties at the border, but not the 21% VAT. Better liquidity for growing importers, especially those handling high-value or frequent shipments.

Yes — you pay customs duties, excise taxes (if any), and other fees immediately. Only the import VAT (usually 21%) is deferred to your VAT return.

On your Dutch VAT return: Report the import value + VAT in Box 4a (VAT on imports from outside the EU). Deduct the same VAT amount in Box 5b (input tax on imports). The two entries normally cancel each other out, so you pay little or nothing extra for the import VAT.

You should apply well in advance. Processing time varies, but it’s recommended to request it before you start regular imports. The application is submitted in writing to the Belastingdienst (Dutch Tax Authority) using their official form. Approx 4-6 weeks

You must appoint a Dutch fiscal representative (tax representative) who can apply for the permit on your behalf and handle your Dutch VAT obligations. Some representatives can also share their existing Article 23 permit under certain conditions.

You must keep excellent records of all imports. You remain fully responsible for correct reporting. A financial guarantee or security may be required (especially for foreign companies). Misuse or poor administration can lead to the permit being revoked. It does not exempt you from VAT — it only defers the payment timing.

Yes — the Netherlands is one of the most importer-friendly EU countries because of this scheme. Many other EU countries require you to pay import VAT upfront and claim it back later (which hurts cash flow). This is why many companies choose to import via Dutch ports (Rotterdam, Amsterdam) and use Article 23.

The amount of security is determined by the Dutch tax authorities (Belastiningdienst). In doing so, they consider the expected financial risk. The starting point for the amount of the security is the VAT amount that must be paid on average per month on the services for which the fiscal representative is responsible. This concerns the supply of goods and/or services, intra-Community acquisitions, and imports from non-EU countries. Services that are exempt or subject to 0% VAT are also included in this calculation. Are there services for which the liability for VAT has been shifted to the recipient? If so, these are also included. Input VAT is not taken into account. If the same goods are involved in multiple transactions (for example, imports from non-EU countries followed by a supply of goods), only one of those transactions is counted for the determination of the amount of the security.The security is 5% of the VAT amount determined above. A minimum amount of €5,000 applies.