US entrepreneurs start live your Dutch dream

Always been in love with Amsterdam and is it a long-time dream to have your own company there? Amsterdam is a great place to live and work. The city’s got a great quality of life, with the all-over bikes being an easy way of transportation, an always-buzzing cultural environment – and plenty of time to enjoy all, as the Netherlands is known for a proper work-life balance. Also it sets high standards in education, healthcare and family life.

Normally there are many formalities and substantial investment amount required for non-EU citizens to start a business in the Netherlands. If you are a US person that wants to move over under a self-employed status, you will be exception. As a self-employed person you solely have to save €4,500 (around $ 5,000) to start your Dutch dream. 

The Dutch-American Friendship Treaty (in short DAFT) is a treaty between the United States and the Netherlands dating from the year 1956. The treaty covers friendship and commerce. The treaty allows US self-employed persons to acquire Dutch residency for the purpose of starting a business. Under the treaty Dutch traders and investors to enter the US and engage in business in the US. Since the start, the Dutch never raised the minimum investment amount of 10,000 guilders (now € 4,500), From the side of the United States the investment amount was raised for Dutch newcomers to around $ 100,000 and other benefits were limited as well.

The Dutch American Friendship Treaty offers you the possibility to come over to the Netherlands, incorporate a company and fund the company's bank account with at least € 4,500. There is no check on entrepreneurial experience, no limitation to age and you can also sponsor your spouse and minor children for residence. Any kind of business is available under the treaty. It's also an option to open a branch of an existing American company or acquire, part of, an existing Dutch business.

The first DAFT residence permit is issued for a period of two years. The minimum required business investment amount is to be deposited on the company’s bank account and this amount must be maintained throughout the entire period of having a DAFT residence permit. Under the DAFT scheme, there exists no obligation to learn the Dutch language, although the language test will be required if you intend to apply for a permanent residence or citizenship after five years.

There are also limitations to be aware of when you consider to apply for a DAFT residence permit. The most important limitation under the DAFT treaty is that you or your spouse will not be able to be employed in the Netherlands by any other business than your own. An escape from this rule could be that you will remain to have the right to get qualified as a highly skilled migrant and as such get employed by a Dutch company. 

Another limiting factor is that to renew the DAFT residence permit, initially after a two year period and followed by five year periods, you must demonstrate your company to be active and not solely kept in place for the DAFT residence permit. Also accepting government aid can affect your outlook at renewal approval.

Next thereto the presence of the investment amount of € 4,500 shall be confirmed at renewal. The investment amount must be maintained at all times. So be aware that the amount can not be spent on business expenses. 

Entrepreneurship also means bookkeeping and filing value added tax and corporate income tax filings and possible also other taxes. The Dutch tax authorities are supportive and cooperative, never the less non-fulfilment of the tax rules can easily result to fines. In case you do not speak Dutch it will be good to have the accounting and tax matters dealt by a local bookkeeper.

Approximately 300 US citizens annually apply for the DAFT status, of which almost 100% of the applications, a DAFT residence permit is granted. Despite the high success rate, a visa application requires thorough preparations. It is wise to prepare a to-do-list that contains all steps, such as certification of documents, registration of a Dutch company or self-proprietorship, certification of an initial balance sheet, etc. 

If you read all the above and want to become part of the business community in Amsterdam under a DAFT residence permit, the Netherlands welcomes you. Please do not be stopped by the treaty’s remarkable name. The DAFT treaty is serious business.



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