Blog Docs Pricing Philosophy About Log in Sign up
Guide

KOR

The Dutch small business VAT exemption scheme — what it is, who benefits, and how Peil handles it.

What is KOR?

KOR stands for Kleineondernemersregeling — the Dutch Small Business Scheme. It's a VAT exemption for businesses with annual revenue below €20,000. Under KOR:

  • You don't charge VAT on your invoices
  • You don't remit VAT to the Tax Authority (Belastingdienst)
  • You also can't reclaim VAT on your business purchases

KOR is an opt-in scheme. You apply to the Belastingdienst, and once enrolled, you're committed for a minimum of 3 years. You cannot switch back to regular VAT within that period unless your revenue exceeds the threshold.

Who benefits from KOR?

KOR tends to make sense for:

  • Starting freelancers with limited revenue who want to simplify their administration — no quarterly VAT returns to file.
  • Service providers to private individuals (B2C) where clients can't reclaim VAT anyway. Under KOR, your effective price is lower without cutting your margin.
  • Anyone who values administrative simplicity over the ability to reclaim input VAT on business expenses.

If most of your clients are businesses (B2B) and they reclaim VAT, KOR is typically less attractive — you lose the ability to reclaim input VAT on your own costs.

Enabling KOR in Peil

Go to Settings and toggle KOR on. Once enabled:

  • VAT is suppressed to 0% on all invoices in the editor
  • The legal disclaimer required by Dutch law — Article 25, Wet OB 1968 — is automatically added to every invoice PDF in both Dutch and English
  • NER and financial calculations in Peil continue to work normally (income tax still applies)

Threshold warning

The KOR threshold is €20,000 in annual revenue. Peil starts warning you with an amber notice on the dashboard when your projected annual revenue approaches €17,000 — well before the legal limit, giving you time to think and act rather than scrambling at the last minute.

If you exceed the threshold

If your revenue is heading toward €20,000, you need to end your KOR registration with the Belastingdienst proactively. Once you exceed the threshold mid-year, you must switch to regular VAT — which means issuing revised invoices for that year and dealing with the administrative complexity that comes with it.

The practical advice: don't cut it close. Use Peil's warning to start the conversation with your accountant well in advance.

KOR and income tax

KOR only affects VAT. Your income tax obligations are unchanged — you still pay inkomstenbelasting on your profit. The tax reserve in Peil continues to apply. See Tax reserve.

KOR vs. exempt services

Some services are legally VAT-exempt regardless of KOR — for example, certain healthcare or educational services. If your work falls into one of those categories, you may already be operating VAT-free without KOR. Peil assumes standard freelance services (consulting, design, development, etc.) and the standard Dutch VAT rules that apply to them.