Growing your business
What happens if I cross the KOR threshold?
Passing €20.000 is good news with paperwork attached. Here is the sequence, step by step.
3 min read
In plain English
The €20.000 limit is measured across the calendar year. The moment your turnover for the year passes it, your participation in the KOR ends — including for the invoice that took you over.
Nothing dramatic happens overnight. You notify the tax office, you start showing VAT on invoices again, and you go back to quarterly returns.
One detail catches people out: on the invoice that crosses the line, VAT applies to the whole invoice, not just the part above €20.000.
- 1
Your turnover increases
Business is going well and your cumulative turnover approaches €20.000.
- 2
Your VAT obligations may change
Once you pass the threshold your participation in the KOR ends and you notify the tax office.
- 3
Future invoices may need VAT
Including the invoice that crossed the line — VAT applies to that whole invoice.
- 4
Bookkeeping becomes more comprehensive
Quarterly returns come back, and so does reclaiming VAT on your purchases.
- 5
You keep growing, with confidence
Nothing about this is a setback — crossing the threshold means the business is working.
Why it matters
- Quoting a price without VAT and only realising afterwards means the VAT comes out of your own margin.
- You must notify the tax office — this is not automatic.
- On the plus side, you can reclaim VAT on purchases again from the moment you are back in the system.
When it applies
- As soon as your cumulative turnover for the calendar year passes €20.000.
- You cannot rejoin the KOR until three years after you left.
- Your dashboard tracker warns you well before you get there.
A practical example
The invoice that tips you over
By October you have invoiced €19.200. A new project is worth €2.000.
That invoice crosses the line, so it carries 21% VAT on the full €2.000 — the client pays €2.420.
Tell your client before you send it. Business clients will not blink; private clients need to know the price changed.
Common mistakes
- Only checking turnover at year end.
- Charging VAT on just the amount above the threshold.
- Forgetting to notify the tax office that you are leaving the scheme.
- Not repricing: if you quoted "€2.000 all in", the VAT now comes out of your margin.
Scenario
I'm at €19.400 in September
What should I do now?
Assume you will cross. Quote your next projects with VAT clearly shown, tell recurring clients now rather than later, and check whether any planned purchases are worth delaying until you are back in the VAT system — you can reclaim the VAT on them then.
You may also want to learn about
- What is the KOR?A scheme for small businesses under €20.000 turnover: you stop charging VAT, and you stop reclaiming it too.Read the full topic
- What is VAT (BTW)?The tax you add to your prices, collect from customers, and pass on to the tax office. It never belongs to you.Read the full topic
- What a Dutch invoice must containNine details make an invoice valid. Miss one and your client may not be able to deduct it — or pay it on time.Read the full topic
These explanations are simplified for clarity and are not tax advice. Rules change; check with the Belastingdienst or ask Ardel for a review.