The ball is in your court. You become an entrepreneur and you decide to register at the Chamber of Commerce. Congratulations! What do you all need to consider, besides a lot of mail and a VAT number? In this article, we help you get started together with accountant Marcel Huting. These accounting tips for start-ups are, trust us, a lifesaver for those who are now at the beginning of their sustainable entrepreneurial adventure. If you have been on the road for a while, you can think of this as a handy checklist. Have you thought of all these things?
Accounting tips for start-ups
In cooperation with Huting Tax Advice & Administration
Enthusiastic about your great idea or excited by the new entrepreneurial adventure, a lot of budding entrepreneurs underestimate that running a business, even if it is a small sole proprietorship, involves a lot of administration. And you shouldn't take that lightly. Marcel: ‘The administration is the basis of your business and the basis of your tax return. Without this overview, you can't make good (management) decisions, you can miss out on tax benefits - a shame - and you can be faced with unpleasant surprises such as an unexpectedly high tax assessment or a fine from the tax authorities in case of mistakes. In short, as a sustainable entrepreneur, take your accounting seriously and get help if you run into things.’ What all should you think about when starting your (sustainable) business? Together with accountant Marcel Huting take you through the most important issues!
Your CoC registration as a starting entrepreneur
Of course, it all starts with that registration at the Chamber of Commerce (CoC). Or well, you don't have to. Before we share all accounting tips and tricks for entrepreneurs, it is good to know that you do not have to become an entrepreneur right away if you want to earn money with your initiative. Want to know more about this? Then check out this article!
Marcel: ‘When you register with the Chamber of Commerce, you can choose from a number of legal forms. The most common forms for a starting entrepreneur are: a sole proprietorship, a private limited company (bv), a general partnership (vof), a limited partnership (cv) and the partnership (liberal professions). Most starting entrepreneurs choose a sole proprietorship. If you are going to collaborate with another entrepreneur, a vof is most likely a logical construction for you. A vof is a legal form in which several business partners are jointly responsible for running a business. The owners are called partners.’ The last four legal forms do need to already exist before you can register them with the Chamber of Commerce.
‘You can also set up a BV,’ Marcel continues, ‘although most starting entrepreneurs will probably not opt for this straight away, I will mention it for the sake of completeness. Setting up a PLC costs a relatively large amount of money and you have to turn over quite a bit of turnover, because you have to pay yourself a minimum annual salary. (In 2024, that will be 56 thousand euros per year). That's quite a threshold that makes most starting entrepreneurs opt for a sole proprietorship. For that, you don't need any start-up capital. The disadvantage of a sole proprietorship is that you are jointly and severally liable. Suppose you have a debt with your company and you go bankrupt, you have to pay the debt with your private assets. Incidentally, this also applies with a general partnership. With a BV, this is usually not the case.’
Opening a business bank account
You are going into business. Do you need a business account then? The short answer is ‘yes!’ Marcel: ‘The tax authorities want to see your bank account, but they do not oblige you to open a business account. Yet it is wise to open a business bank account, for the following reason: your bank will most likely not allow you to use a private account for business purposes. Many banks’ general terms and conditions state that you are not allowed to use a private account for business purposes. Another factor is that it is nice to separate the money flows. And it looks professional towards your customers and suppliers: a business account in the name of the company'.’
Choose your sofa carefully
Every bank has a sustainability policy. Which policy best suits your sustainable views? You have green banks, such as Triodos Bank and De Volksbank (which includes ASN, SNS and Regiobank), which only invest in projects that contribute to a greener and fairer society. Big banks, such as ING and ABN AMRO, do not always exclude polluting companies because they believe you have to do sustainability precisely with the big organisations. So choose a bank that suits what you believe in most. In addition, there is a lot of price difference between banks. A popular and affordable bank among self-employed people is Knab. Their sustainability policy is on their website.
Discipline with your business account
Every entrepreneur knows that discipline and structured work are super important. After all, entrepreneurship is hard work and it does not come easy to most people - no matter what those business coaches try to tell you on Instagram. Discipline is also important when doing your administration. Marcel: ‘Keep your private and business expenses separate. Do not take private groceries and other private expenses out of your business account. This will make your bookkeeping unnecessarily complex. Only use your business account for business income and expenses. Of course, it can happen the other way around: that you use a private account to make a business expense. In that case you can easily solve it by transferring the amount (with a clear description) from your business account to the private account. That way, you turn it into a business expense claim and your accounts are correct again.’
Choosing your accounting software
So, the registration at the Chamber of Commerce has been arranged, that business account has been opened and then it is time to choose an accounting programme. An online accounting programme is an online tool for entrepreneurs and freelancers to manage their finances. With such a programme, you can easily prepare and send invoices, track expenses, import bank transactions automatically and keep your accounts real-time keep up-to-date. In addition, many online accounting programmes offer useful features such as VAT returns, reports, and links to other software, saving you a lot of time and stress. Ideal for those who want to keep their administration efficient and well-organised! An accounting programme is an indispensable tool and once you choose one, you don't switch easily. All the more important to orient yourself properly before choosing and setting something up. There is a lot on offer, so what do you choose?
Marcel: ‘First of all, it is important that you choose a programme that can establish a link with your bank. A link means that your bank automatically shares all credits and debits with your accounting programme. Keeping track of all this manually is a hopeless task. And most accountants won't want to work with you either if your accounting programme doesn't have a bank link.’
As with choosing your bank, it is also smart to compare the prices of different accounting programmes. There are big price differences and some programmes offer a long free introductory period. Marcel: ‘Also check the prices of the bank link, that too is not free. Our team enjoys working with the accounting programmes e-Accounting.nl and SnelStart, because we find these the most user-friendly. So a tip, should you still be looking.’
Taking out insurance as a start-up
As an entrepreneur, you will have to take out separate insurance policies, because the ones you have as a private individual do not apply to your business or to you if you act as an entrepreneur. If your business laptop breaks down, you cannot claim it on your private household insurance. If you knock over an expensive vase while visiting a customer, your private liability insurance will not cover it. Marcel: ‘Think about the risks you want to cover and find the right insurance for them. For most starting entrepreneurs, zzp liability insurance and perhaps disability insurance are the first insurances that matter.’
Note: from 1 January 2027, it will most likely become compulsory for self-employed, freelancers or entrepreneurs to take out disability insurance, and the average premium is quite hefty (up to 195 euros a month, it is expected).
Creating correct invoices
Create a template (a template) for an invoice once, so you can always use this document afterwards when preparing invoices. This is so easy and quick. If you have an online accounting programme, you can create a template in the programme. Marcel: ‘There are rules for drawing up invoices. You can even be fined if an invoice is not drawn up correctly. So it's important to sit down and think about this. Tip: get your template checked by an accountant (or a family member or acquaintance who knows about it), so you can be sure that everything is on there (correctly).’ You can read more about invoicing in this article.
What all comes your way as a start-up entrepreneur?
As a business owner, you have to file your VAT return four times a year to find out how much sales tax you owe the tax authorities or maybe get a refund if you incurred a lot of expenses. This is called the quarterly statement. And once a year - like everyone else who works - you have to deal with income tax. You also pay an annual contribution to the Health Insurance Act (this is a percentage of your profit). Marcel's tip is: ‘Put enough money aside for this in advance to avoid surprises afterwards. If you already know at the start that you will earn quite a bit, it is smart to apply for a provisional assessment for income tax and healthcare insurance contributions right away. From the second entrepreneurial year onwards, you will start paying an advance every year and a final calculation will follow at the annual income tax. Then you will have to make additional payments or get money back. What exactly you have to take into account is hard to say; every profession is different. We have more tips for you to make your quarterly closing easier.
Entrepreneur's deduction
The self-employed deduction and also the start-up scheme can be interesting schemes when you are starting out. Marcel: ‘If you can prove that you work at least 1,225 hours a year on your business, you can qualify for the self-employed deduction. That equates to working about 24 hours a week, every week of the year (no holidays, that is). The advantage of this scheme is that part of your profit is untaxed. The disadvantage is that you have to keep a record of hours for the tax authorities. Have you just started as an entrepreneur and are you using the self-employed deduction? Then you may also be eligible for the starter scheme. The starter scheme is an increase in the self-employed deduction. More deduction = less tax. You can use this three times in the first five years you are an entrepreneur. On the other hand, you do always get the SME exemption. This exemption is a deduction from your profit and you do not have to apply for it separately. The tax authorities automatically take this exemption into account when you file your income tax return’.’
Time recording tip
You don't need to buy a complicated system for your timekeeping. You can simply do this in an Excel file that you save in the cloud or on your server. Create a template in Excel for one week's time registration. Copy this template into 52 tabs, each week of the year gets its own tab. Then enter how much time you spent on an activity each week. If your activities are roughly the same each week, it is smart to include this already in your template. Then you only need to fill in the hours each time. ‘You have to keep this time registration for seven years, just like the rest of your records,’ Marcel says.
Deducting business expenses as a start-up entrepreneur
‘Even if you start small, as an entrepreneur, you may include the expenses you incur for your business as expenses. (You can read more about business expenses in this article.) You deduct these costs from turnover without VAT. The amount remaining under the line is profit. And you have to pay income tax on that profit. If you make use of the small entrepreneurs scheme, things are different. This scheme can be interesting if you expect to turn over less than twenty thousand euro in a year. But this scheme also has disadvantages. You can read more about the KOR in this article.
More accounting tips for start-ups
These tips will give you enough ammunition to set up your bookkeeping properly. Marcel: ‘Take your bookkeeping seriously, spend time on it every week, make sure you have a good process (with checklist), save everything and dare to ask questions if you are in doubt or can't figure it out. There is no such thing as stupid questions.’ Still have questions or need more help?
Need more accounting tips and help?
Maybe you have been doing business for a while, or maybe your initiative is still in its infancy. Either way, with the guide for starting entrepreneurs, we would like to help you on your way with the administrative side, so you can do what you do best: make your idea a success! Because say it yourself, it's a nice idea when the administrative basics are all in order. With the help of this guide, you will have everything you need to organise your company's bookkeeping properly, learn good habits and, as a bonus, we will also share with you how you can do business a little more consciously. We got you!
For 13.50 euros, you have this lifesaver directly to your inbox and so on your tablet or mobile phone! Order the guide for start-ups in our webshop!
About Marcel Huting
Marcel does administration and bookkeeping for a variety of companies and individuals throughout the Netherlands. He can help you get started or take over the entire bookkeeping process from you. Find out more about Huting Tax Advice & Administration.
Photo credits main image: George Milton (Pexels).
