UK subsidiaries for Dutch companies

The Netherlands sends 39 investment projects to the UK a year. Dutch parents are disproportionately holding companies for groups headquartered elsewhere, which changes two things about the UK set-up.

The ownership register

Every UK company must record who ultimately controls it. Where the immediate shareholder is a Dutch BV that is itself a holding company for a group based somewhere else, the register generally has to look through to the individuals at the top, or record the position accurately where no individual holds more than 25%. Getting this wrong is a criminal offence and it is the item most often wrong on incorporations done from a holding structure.

Treaty claims

Interest and royalties paid from the UK subsidiary carry 20% UK tax at source unless the UK–Netherlands treaty reduces the rate and the claim has been made to HMRC in advance. Where the Dutch company is an intermediate holding company rather than the ultimate parent, treaty access is a question that deserves a proper answer before the first payment rather than an assumption. Dividends are unaffected: they leave the UK without withholding tax whatever the structure.

Goods and people

Goods from the Netherlands cross a customs border, so the subsidiary needs an EORI number and postponed import VAT accounting. Social security for posted staff is covered by the UK–EU protocol, so a Dutch employee posted here can usually stay in the Dutch system with a certificate.

Three things we set up differently for a Dutch parent

1. The ownership register. Dutch parents are disproportionately holding companies for groups headquartered elsewhere. Where the immediate shareholder is a BV that is itself a holding company, the UK register generally has to look through to the individuals at the top, or record accurately that no individual holds more than 25%. Getting this wrong is a criminal offence and it is a common error on incorporations from a holding structure.
2. Treaty access, established before payment. Interest and royalties from the UK company carry 20% tax at source unless the UK–Netherlands treaty reduces it and the claim is made in advance. Where the BV is an intermediate holding company rather than the ultimate parent, treaty access deserves a proper answer rather than an assumption. Dividends are unaffected and leave the UK untaxed whatever the structure.
3. Customs. Goods from the Netherlands cross a border, so EORI, a customs agent and postponed import VAT go in with the VAT registration. For groups distributing into the UK from a Dutch warehouse, the Incoterms decide who is the importer of record and therefore who bears the import VAT.

What Dutch groups find different

UK incorporation is faster and lighter than the Dutch equivalent: no notarial deed, no minimum capital, one share is enough, and the company is live within a day. What is heavier is publication. A UK company's accounts are on a public register that anyone, including a competitor, can download.

Employment is more committal than groups expect. There is no at-will employment, notice is contractual and statutory, and dismissal requires a fair reason and a fair process. Contractual notice of one to three months is normal for senior UK hires.