Establish a Holding + BV, only a BV or a Sole Proprietorship?

[MagdalenaS]

I couldn't find any threads in English about this. I need help to chose the best establishment type, so I will brief my idea below:

 

I  want to open a company that will work with trading and (mainly) e-commerce. I initially thought of selling to platforms like Amazon, Bol, Aliexpress, etc. and eventually maybe connect Alibaba which is only for manufacturers. So this way I can use drop-shipping as an option, but also act as a company agent. My biggest competitive advantage is that I have a very reliable supplier from the Balkans (its our family company - I want to start an independent business with their support). If the business develops well, I plan to expand the reach to buying from different suppliers and more platforms, but will initially start with Amazon as the steadiest option. I won't go into too much detail, but I am convinced there is a lot of potential for this to grow.

 

*I read a lot about the legal types and I contacted an agency that helps with startup processes and they strongly recommend a holding company + bv. It has tax and liability benefits, I know - but I'm a bit hesitant for 2 reasons:

- If this is a way bigger cost and responsibility than I could take at the beginning;

- It may be more beneficial for the consulting company I contacted than it would be for me because they complete your notarial deed(s)...

 

The funds to start and pay the expenses for establishment are no problem, but I am not sure how much returns will I get from this in the first year. I am not risk averse, I just want to focus on the controllable aspects of the situation. 

[Hans van den Bergh]

Welcome to our Forum

 

Instead of a suitable thread on the Higherlevel Forum, could this information be of use to you?

[MagdalenaS]

2 minutes ago, Hans van den Bergh said:

Welcome to our Forum

 

Instead of a suitable thread on the Higherlevel Forum, could this information be of use to you?

Hello, thank you! 

I read everything on the website and did follow up with the quiz, but it gives a 50/50 answer. 

[Joost Rietveld]

If not for the 'protection' of personal assets, your main question will be tax burden.

What do you expect in terms of annual profits? 

[MagdalenaS]

5 hours ago, Joost Rietveld said:

If not for the 'protection' of personal assets, your main question will be tax burden.

What do you expect in terms of annual profits? 

This really depends on the market fluctuations and how my experience shows - there is alot of potential to grow quickly if I ace the marketing. With perfect sight in view maybe a bit less than 100k the first year, and at least 150k the next year. 

[Joost Rietveld]

And you are a Dutch resident with a citizens service number (burgerservicenummer)?

[MagdalenaS]

14 hours ago, Joost Rietveld said:

And you are a Dutch resident with a citizens service number (burgerservicenummer)?

Dear Joost, 

 

Yes, I am an EU citizen and I am registered - I do have a bsn and a DigID. 

[Joost Rietveld]

Then a 100k profit would be more pleasantly taxed as a sole propriortorship than a BV. Changing it to a BV in a later stadium, once profits have further increased, is also a possibility, even without any extra tax burden

[MagdalenaS]

18 minutes ago, Joost Rietveld said:

Then a 100k profit would be more pleasantly taxed as a sole propriortorship than a BV. Changing it to a BV in a later stadium, once profits have further increased, is also a possibility, even without any extra tax burden

I really appreciate your advice! I will definitely take it in consideration - thats what I was leaning towards as well, and as the company grows, I assume may be best to switch then. Some private consultants were very stiff about opening a holding company, which I see is double the expense due to the fact we need 2 bv's for this to function. (also the notary deeds..) 

Thank you!

[Joost Rietveld]

2 uur geleden, MagdalenaS zei:

Some private consultants were very stiff about opening a holding company, which I see is double the expense due to the fact we need 2 bv's for this to function. (also the notary deeds..) 

I can't really disagree with them in most cases. See my column on this site here (use translate). It's mostly about the separation of your entrepreneurial risks from your assets, then anything else.