VAT in settlements for owners under the small business scheme (KOR)

An owner who rents out a holiday home is, in principle, a business for VAT purposes. If their annual turnover stays below the threshold (in the Netherlands, € 20,000 per calendar year), the owner can opt for the small business scheme (KOR, kleineondernemersregeling). This affects how VAT is handled.

What does the KOR mean for the owner?

• No VAT charged, and no VAT return: The owner doesn’t charge VAT to guests or to the rental organisation, and doesn’t file VAT returns for this turnover.

• No VAT deduction (input VAT): Because the owner is exempt from VAT, they also can’t reclaim VAT that third parties charge them. Invoices to a KOR owner are therefore paid including VAT. For the owner, that VAT is a final cost.

Setting who is responsible for VAT

1. Open the owner page.

2. In the Owner data block, click Edit.

3. Under Who is responsible for VAT?, choose one of the options:

How VAT works in the settlement

The park or administration often collects the full rent, including VAT, on behalf of the owner. Because the park or administration then acts as an intermediary or withholds the VAT, a specific settlement mechanism applies to KOR owners:

• VAT is withheld: the VAT that the owner would otherwise pay is withheld by the administration from the rent to be paid out. The administration pays this VAT to the tax authorities.

• Correction on the same ledger account: the gross rent is booked on the revenue account, for example 8000. The withheld VAT is booked as a negative amount on that same account, so the VAT is not left as revenue.

• Commission: the administration’s commission, including VAT, is deducted from the amount to be paid out.

Because the VAT correction is booked on the same revenue account (8000), owners or their accountants are sometimes confused by it.

Example calculation

A holiday home is rented out for € 1,000 including 21% VAT. The administration charges 20% commission. Amounts are positive or negative from the administration’s point of view: rent to be paid out is a cost for the administration (a negative amount).

Important information for the owner:

• The VAT that is due is paid directly to the tax authorities by the park administration.

• Because the owner falls under the KOR, they are not entitled to deduct VAT.

• The owner can’t and mustn’t reclaim the withheld VAT through a VAT return.

• The correction on account 8000 is only there to show the net revenue between administration and owner correctly: the owner receives the rent minus the VAT and minus the commission.