VAT Deferment in the Netherlands: The Cash Flow Trick Big Importers Use
Introduction
Ask a finance director at a large European importer where working capital quietly leaks away, and import VAT will come up sooner than most people expect. Every container that crosses the EU border from outside the bloc carries a tax bill that has to be dealt with before the goods can move, and for a company bringing in dozens of containers a month, that bill can swallow a startling share of the cash that was meant for stock, marketing and payroll.
The Netherlands has been solving this problem for decades. Through a mechanism known as the Article 23 licence, approved importers do not pay import VAT at the port at all. Instead, the tax is reported in the periodic Dutch VAT return, where it is declared as payable and, if the business is entitled to deduct it, claimed back in the very same return. For many importers the net cash effect at the border is zero.
This guide explains how the scheme works in practice, who qualifies, where it stops helping, and how it sits alongside the new EU rules for low-value parcels that took effect on 1 July 2026. It is written from a freight forwarding point of view, which means we care as much about container flows, customs entries and shipping documents as we do about tax theory. It is general information rather than tax advice, so confirm the details with a Dutch tax adviser before you apply.
Why Import VAT Hurts Cash Flow More Than Most Importers Admit
How import VAT is calculated
Import VAT in the Netherlands is charged at the standard rate of 21 percent on most goods, with a 9 percent reduced rate for a limited list of products such as certain foods and books. The taxable base is not simply the price on your commercial invoice. It is the customs value of the goods, plus any customs duty payable, plus other taxes and levies due on import, plus the cost of transport and insurance up to the first place of destination inside the EU.
That last element catches many first-time importers. A shipment from Shenzhen to Rotterdam sees its ocean freight added to the base, and if the goods are already known to be heading on by truck to a warehouse elsewhere in the EU, that inland leg can be pulled in as well. The result is that the real VAT bill is usually a little larger than a quick calculation on invoice value would suggest.
The hidden financing cost
Without deferment, the sequence looks simple on paper. The importer or its customs broker pays the import VAT to Dutch Customs when the declaration is accepted, the goods are released, and the importer later recovers that VAT as input tax in its regular return. In reality the money leaves the bank days or weeks before the container is even delivered, and it does not come back until the return has been filed and processed.
That gap is the real cost. A business filing monthly returns may pay VAT at the border early in one month, file the return at the end of the following month, and then wait again for a refund. Depending on when the containers arrive, the average amount of cash tied up often lands somewhere between one and two months of import VAT. Some advisers quote a typical financing period of 60 to 90 days per shipment, although the true figure depends on your filing frequency and how quickly the tax office pays refunds.
To make this concrete, picture an importer that brings in goods with a combined customs value of 1.2 million euros each month, with average duty of 4 percent. The VAT base is about 1.248 million euros and the import VAT is roughly 262,000 euros a month. If that money stays tied up for an average of one and a half months and the company’s cost of capital is 8 percent, the annual financing cost is close to 31,000 euros, all for cash that the company never really owned.
| Item | Illustrative figure |
| Monthly customs value of goods | EUR 1,200,000 |
| Average customs duty (4%) | EUR 48,000 |
| VAT base (value plus duty) | EUR 1,248,000 |
| Import VAT at 21% | EUR 262,080 per month |
| Average cash tied up (1.5 months) | EUR 393,120 |
| Financing cost at 8% per year | About EUR 31,450 |
The financing cost is only part of the picture. Trapped cash also limits purchasing decisions, forces uncomfortable trade-offs between marketing spend and stock replenishment, and can put pressure on credit lines that lenders watch closely. For e-commerce sellers running on thin margins, paying tens of thousands of euros in VAT before the goods are even sold can be the difference between reordering a best seller and running out of stock.
There is also a timing risk that rarely shows up in a spreadsheet. Ocean freight schedules slip, peak-season congestion delays discharge, and a container that was supposed to arrive in the first week of the month may land in the last. Under the pay-first model, that shift can push the refund into a completely different return period, so the cash gap stretches without anyone deciding it should. Deferment makes the position far more predictable, because the VAT entry follows the customs declaration rather than the calendar of your bank account.
What the Article 23 Licence Actually Does
The Article 23 licence takes its name from Article 23 of the Dutch VAT Act, and in Dutch it is called the artikel 23 vergunning. It allows an approved business that imports goods into the Netherlands to postpone the payment of import VAT at the border and account for it in its regular VAT return instead. Approval comes from the Dutch Tax and Customs Administration, and the licence is tied to a specific legal entity rather than to a particular shipment or route.
Some sources describe the mechanism as postponed accounting, which is a fair shorthand. The importer declares the import VAT as tax due and, if it has the right to deduct VAT, claims the same amount as input tax in the same return. When both sides of the entry balance out, nothing is payable to the tax office and nothing has to be prefunded at the port.
Payment at the border versus postponed accounting
The easiest way to see the difference is to follow a single container through both processes. Without the licence, VAT is paid to Customs at release. With the licence, Customs releases the goods on the strength of the licence number quoted in the declaration, and the VAT movement happens only on paper, inside the return.
| Stage | Without Article 23 | With Article 23 |
| Customs declaration accepted | Import VAT assessed and payable immediately | Licence number quoted; no VAT payment required at the border |
| Release of goods | After VAT is paid or secured | After declaration is accepted; VAT is not prefunded |
| VAT return | Import VAT claimed back as input tax; refund or offset follows | Import VAT declared as due and deducted in the same return |
| Cash position | Cash goes out first and comes back later | Usually neutral for import VAT |
| Administrative focus | Matching broker invoices to the return | Reconciling customs entries with return figures |
Notice that the right-hand column does not remove the tax. The VAT is still declared, still reported and still open to audit. What disappears is the prefunding. That distinction matters when you explain the scheme to a sceptical finance team or a cautious lender, because the licence is not a loophole. It is a timing rule that the Dutch state built deliberately to keep Rotterdam and Schiphol competitive as gateways into Europe.
What the licence does not cover
The first limitation is that Article 23 defers VAT only. Customs duty is a separate charge and must still be settled, unless the importer holds a different authorisation for deferred payment of duties, which usually comes with its own financial guarantee. Importers who assume that the licence makes the whole customs bill disappear are often surprised by the duty invoice that follows their first shipment.
The second limitation involves low-value parcels shipped directly to consumers. Where VAT on a consignment worth 150 euros or less is collected through the Import One Stop Shop, the VAT has already been settled at the point of sale, so there is no import VAT to defer at the Dutch border. Article 23 is built for the bulk-import model, where goods arrive in containers, sit in a warehouse and are then sold on.
The third limitation is more subtle. The licence only makes sense if the importer actually has a right to deduct the import VAT. A business that makes mostly VAT-exempt supplies, or that cannot recover input tax for other reasons, would be shifting rather than eliminating a real cost. For most trading companies, wholesalers and online sellers this is not an issue, but it deserves a moment of thought before the application goes in.
Who Can Get It and What the Dutch Tax Authorities Look For
Not every importer is eligible, and the Dutch authorities look at more than the bare paperwork. They want to see a business that is real, organised and likely to stay compliant.
Dutch companies
A company established in the Netherlands, with regular imports, a clean tax compliance record and a properly organised administration, can apply directly. The authorities want to see that the business understands its VAT obligations, files returns on time and can reconcile its customs entries with its accounting. A start-up with no history and a shaky bookkeeping system may find that its application meets far more questions than a mature trading company would.
Non-EU and other foreign companies
Foreign businesses, including sellers based in China, Hong Kong or the United States, can also benefit, but the route is usually indirect. Under the commonly used structure, the foreign company registers for VAT in the Netherlands and appoints a fiscal representative, an authorised Dutch agent that holds the licence or files returns on its behalf. The representative acts as the intermediary with the tax office and often as the practical day-to-day contact.
Fiscal representation is a real commitment, not a formality. The representative usually carries joint liability for the VAT of the company it represents, which is why reputable providers run background checks, may ask for a bank guarantee or deposit, and monitor the account closely. Fees vary widely, so it is worth requesting quotes from several providers and asking exactly what is included in the monthly price.
Timing also deserves attention. Applications are commonly reported to take from several weeks to a few months, depending on the completeness of the file and the workload of the tax office at the time. Businesses that plan a peak-season launch in Europe should start the process well before they place their first big purchase order, not after the first container is already on the water.
Documents and administration
Applicants are generally asked for company registration documents, a description of the business model, details of expected import volumes and product categories, information on the customs broker or forwarder they will use, and evidence that a Dutch VAT number and an EORI number are in place. The EORI number identifies the importer in EU customs systems and is required for any customs declaration.
Good records are the price of the privilege. Each deferred import must be traceable from the customs declaration to the entry in the VAT return, and from there to the purchase invoice and the freight documents. Businesses that build this reconciliation into their monthly close, rather than scrambling when an auditor calls, rarely run into trouble.
Article 23 Versus the Other Routes Into the EU
Article 23 is one of several ways to handle import VAT, and the right choice depends on where your goods end up and who buys them. The table below compares the four routes that come up most often in conversations with importers.
| Route | Best for | VAT treatment | Main drawback |
| Pay at customs and reclaim | Occasional importers | VAT paid at the border, recovered through the return | Cash is prefunded |
| Article 23 licence | Regular importers holding stock in the Netherlands | VAT postponed to the periodic return | Application effort; duty still due |
| Customs procedure 42 | Goods moving straight on to a business customer in another EU country | Import VAT exempt; onward supply reported as intra-EU | Strict proof of transport and a valid destination VAT number |
| IOSS | Consignments up to EUR 150 sold to consumers | VAT collected at the point of sale | Only for low-value B2C parcels |
Procedure 42 deserves a closer look because it is often confused with Article 23. Under it, goods imported into the Netherlands that are immediately shipped to a business customer in another EU member state can be imported without Dutch VAT, provided the importer holds a valid VAT number in the destination country and can prove that the goods really did leave. The VAT is then accounted for in the destination country. It suits importers who use Rotterdam as a gateway rather than a stockholding location.
Many mid-sized importers combine both. Procedure 42 handles the containers that head straight for German or French customers, and Article 23 covers stock that stays in a Dutch warehouse. A freight forwarder that understands both flows can plan the bill of lading, the customs declaration and the inland transport around the right treatment before the vessel even sails.
Three Scenarios Where the Numbers Change
The Shenzhen electronics seller with a Dutch warehouse
A seller ships full containers of accessories from Shenzhen to a third-party warehouse near Rotterdam and sells through marketplaces across Europe. Every container carries substantial import VAT, and stock turns over in a matter of weeks. This is the textbook case for Article 23. The seller registers for Dutch VAT, appoints a fiscal representative, and each container is imported with the licence number on the declaration. The cash that used to sit with the tax office funds the next purchase order instead.
The wholesaler serving German retail customers
A wholesaler brings goods into Rotterdam, but almost all of them are sold to retailers in Germany within days of arrival. Holding a Dutch licence would help, yet Procedure 42 may fit better because the goods leave the Netherlands almost immediately and the German VAT position is handled where the customer is. The wholesaler needs a German VAT number, clean transport evidence and a customs broker who knows how to code the declaration correctly. Here the tax logic follows the physical route of the goods.
The young brand testing the European market
A small brand ships a few pallets a quarter using LCL and has no Dutch presence. The import VAT is modest in absolute terms, and the cost of fiscal representation may outweigh the financing benefit. For a business at this stage, paying VAT at the border and reclaiming it is often the sensible choice, at least until volumes justify the licence. The important thing is to revisit the decision as the business grows, rather than staying on the default route out of habit.
From Application to First Deferred Shipment
Before you apply
Start by mapping the trade flow. Where do goods enter the EU, where are they stored, who is the buyer, and in which countries will VAT ultimately be due? Answering these questions honestly often reveals whether Article 23, Procedure 42 or a mix of both is the right fit. Then confirm that the company has, or can obtain, a Dutch VAT number, an EORI number and a competent customs broker.
The application itself
With the groundwork in place, the application is submitted, usually with the help of a fiscal representative or tax adviser for foreign businesses. The tax office reviews the business, may ask follow-up questions, and can request additional documents or guarantees. The process tends to move faster when the file is complete, the business plan is coherent and the contact person responds quickly.
While the application is pending, do not delay shipments that are already booked. Goods can still be imported with VAT paid at the border and reclaimed afterwards. Once the licence is granted, later shipments switch to postponed accounting.
The first deferred shipments
The first few containers after approval deserve extra attention. The licence number must appear correctly in the customs declaration, the broker must be briefed on the new treatment, and the accounting team must be ready to report the imports properly in the next return. A short pilot period with careful checks catches most errors before they multiply. It also helps to run a reconciliation after the first month, comparing customs entries, invoices and the figures in the VAT return line by line.
What Changed in 2026 and Why Deferment Matters More Now
The regulatory background for European importers shifted in 2026, and the changes make cash flow discipline more valuable, not less. From 1 July 2026 the EU ended its customs duty exemption for low-value consignments. In its place, a temporary flat duty of 3 euros per item applies to parcels worth up to 150 euros sent from outside the EU directly to consumers. According to Dutch government guidance, it stays in force until 1 July 2028, after which the standard EU tariff applies to these shipments.
The duty is charged per item, meaning per product type by tariff heading, not per parcel. A box with five identical T-shirts carries a single 3 euro duty, while a box with a T-shirt and a watch carries 6 euros. Because customs duty forms part of the VAT base, the extra charge nudges up the VAT paid on these goods as well.
A European handling fee for low-value consignments is expected to follow in November 2026, widely reported at around 2 euros per parcel, although the final amount and start date should be confirmed against official announcements. Dutch advisers also report that the Netherlands said in June 2026 it would not introduce a separate national handling fee for now and would first watch the effects of the EU-wide charge.
| Date | Change | What it means for importers |
| Until 30 June 2026 | Parcels up to EUR 150 enter duty-free; import VAT still applies | Old baseline for low-value B2C flows |
| 1 July 2026 | Temporary flat duty of EUR 3 per item on parcels up to EUR 150 | Duty raises the VAT base; item-level classification matters |
| November 2026 (expected) | EU-wide handling fee on low-value consignments | Budget for a small per-parcel charge; confirm final details |
| 1 July 2028 | Standard EU tariff replaces the flat duty | Accurate HS codes and valuation become essential |
It would be easy to read these developments as bad news only for parcel-based sellers, but the message for container importers is different. The end of the duty-free era signals a customs environment that is more data-driven, with tighter scrutiny of tariff classification, valuation and declarations. Importers that already run clean, well-documented entries under an Article 23 licence are better positioned for that environment than those improvising each shipment.
For sellers who serve European customers with a mix of direct parcels and bulk stock, the sensible response is a split model. Low-value parcels continue under IOSS with the new duty priced into product margins, while higher-volume inventory moves in containers under Article 23 or Procedure 42, freeing the cash that would otherwise go on import VAT.
The timing of these changes matters as well. With the handling fee expected within weeks and standard tariffs due in 2028, importers have a natural window to review their entire European setup. Companies that revisit classification, valuation and VAT treatment now, rather than after the next rule change, spend less time firefighting and more time planning stock. Deferment is one part of that review, but it is the part that returns cash to the business fastest.
Common Mistakes That Turn a Cash Flow Advantage into a Headache
Weak reconciliation
The most frequent problem is not the licence itself but the paperwork behind it. If the import VAT declared in the return does not match the customs entries, the tax office will ask questions, and the answers take time. Build a monthly routine that ties each customs declaration to the corresponding line in the return, and keep the supporting files together.
Wrong customs values and tariff codes
Undervaluing goods or using the wrong tariff code affects both duty and the VAT base. Errors that look small on a single shipment become large when repeated across dozens of containers. With duty rules changing in 2026, classification deserves the same attention as pricing.
It is also worth remembering that customs authorities compare declarations against transport documents, invoices and, increasingly, data from other sources. Consistency across all of them is the best protection against delays at the border.
Ignoring the role of the fiscal representative
Some foreign companies treat their fiscal representative as a mailbox rather than a partner. Because the representative is usually liable for the VAT position, it will want timely information about volumes, customers and any change in the business model. Keeping it informed avoids nasty surprises, and a good representative will flag problems before they grow.
Treating deferment as free money
Postponed accounting removes the prefunding, but the VAT remains a real obligation that must be reported accurately. Importers who lose their right to deduct, for instance because the business model changes, can find that a mechanism that used to be neutral suddenly creates a real payment. Review the position whenever the business changes.
Audits, Lenders and Financial Reporting
An Article 23 licence changes how import VAT appears in your accounts. Because no cash moves at the border, the VAT shows up as both a liability and a receivable within the same return, and the net effect is often nil. Finance teams should make sure the ledger treatment is documented so that auditors and lenders can follow it easily.
Lenders that finance inventory often like the scheme because it removes one moving part from the working capital cycle. Trade finance providers may still want to see the licence and recent returns, so keep copies ready. A clean track record of accurate returns can help in negotiations for better credit terms.
From a risk perspective, the Dutch tax office can audit deferred imports just as it audits any other VAT position. The advantage of good records is that an audit becomes a routine exchange rather than a crisis, and that is worth more than any single month of cash flow benefit.
How Topway Shipping Fits Into a Deferment Strategy
Tax structures only work when the physical logistics behind them are just as tidy. Since 2010, Topway Shipping, headquartered in Shenzhen, China, has provided cross-border e-commerce logistics solutions, and its founding team brings more than 15 years of experience in international logistics and customs clearance, with a strong focus on China to U.S. transportation. That background matters here, because the Dutch VAT treatment is decided by the quality of the shipping documents long before anyone opens a tax return.
For many sellers the practical challenge is coordination rather than knowledge. The shipper in China, the freight forwarder, the Dutch customs broker, the fiscal representative and the warehouse each hold one piece of the file. When one of them uses a different product description or consignee name, the mismatch travels all the way to the VAT return. Working with a forwarder that understands the whole chain, and that can speak to each party in the language of their function, cuts the number of hand-offs where errors creep in.
Topway’s services span the whole chain, from first-leg transportation and overseas warehousing to customs clearance and last-mile delivery. On the ocean side, the company offers flexible full-container-load and less-than-container-load services from China to major ports worldwide. A shipper filling a whole container for a Dutch importer can use FCL, while a smaller seller testing the European market can consolidate cargo through LCL without waiting to fill a box. For cargo bound for the Netherlands, shippers should confirm the specific routing and sailing schedule with the team.
In practice, a forwarder supports an Article 23 strategy by getting the basics right. Consistent commercial invoices, accurate HS codes, clear consignee details and a correct EORI number on the paperwork all make life easier for the Dutch customs broker and for the fiscal representative who signs off the VAT return. Topway’s customs clearance experience helps shippers avoid mismatches between the export documents leaving China and the entries filed in Europe.
Overseas warehousing and last-mile delivery complete the picture for sellers who hold stock close to their European customers. Goods stored in a warehouse after import can be sold on without new border formalities, and the cash saved by deferring import VAT can be redeployed into the next purchase order. Businesses considering this model can talk to Topway about aligning transport plans, warehouse arrival dates and delivery schedules with their tax and customs setup.
A Practical Way to Decide Whether Article 23 Is Worth It
The simplest test is arithmetic. Take your expected monthly VAT base, apply 21 percent, assume that the money stays tied up for around one and a half months, and multiply by your cost of capital. The table below shows what that looks like at four different import volumes, using an 8 percent cost of capital as an example.
| Monthly VAT base | Monthly import VAT (21%) | Average cash tied up | Annual financing cost at 8% |
| EUR 250,000 | EUR 52,500 | EUR 78,750 | EUR 6,300 |
| EUR 500,000 | EUR 105,000 | EUR 157,500 | EUR 12,600 |
| EUR 1,000,000 | EUR 210,000 | EUR 315,000 | EUR 25,200 |
| EUR 2,000,000 | EUR 420,000 | EUR 630,000 | EUR 50,400 |
Set those numbers against the cost of the scheme: fiscal representation fees, adviser time, possible guarantee costs and the internal effort of reconciliation. For an importer at the lower end, the licence may be a marginal call. At the upper end it is usually a clear win. Do not forget the non-financial gain either, which is fewer holds caused by unpaid VAT and fewer payment approvals to chase before release.
Growth is another factor. A business that expects to double its volume within a year should size the decision against next year’s numbers, since applying takes time and the licence will still be useful long after the first quarter.
It also helps to run the decision past the people who will live with it. The finance team knows the true cost of capital and the reliability of refunds, the operations team knows how many containers arrive in a normal month and how often schedules slip, and the customs broker knows how smoothly declarations pass today. A short workshop with all three usually produces a more honest answer than a purely tax-driven analysis, and it surfaces practical issues, such as who quotes the licence number on the declaration, before they turn into delays.
Conclusion
Article 23 is not a trick in the sense of a loophole. It is a deliberate feature of the Dutch VAT system that lets approved importers report import VAT in their return instead of paying it at the port, and the big players use it because the cash flow effect is so large. For regular importers with a right to deduct VAT, it turns a recurring prefunding burden into a bookkeeping entry.
The scheme rewards preparation. Map your trade flows, choose between Article 23 and Procedure 42 based on where your goods really end up, budget for fiscal representation if you are outside the EU, and keep your customs and VAT records tightly aligned. Pair that with a forwarder that delivers clean documents and dependable ocean freight, and the advantage compounds with every container. The rules around low-value parcels are changing in 2026, so check current details with your adviser and your customs broker before you commit.
FAQs
Q: Does Article 23 mean I pay no VAT at all?
A: No. The import VAT is still declared in your Dutch VAT return. If you have a full right to deduct, the same amount is claimed back in that return, so no net payment arises, but the tax remains reportable and auditable.
Q: Can a company outside the EU use Article 23?
A: Generally yes, most often through a Dutch VAT registration and a fiscal representative. Rules and practice can change, so confirm the current route with a Dutch tax adviser.
Q: Does the licence defer customs duty as well?
A: No. It covers import VAT only. Customs duty is settled separately unless you hold a distinct authorisation for deferred duty payment.
Q: How long does approval usually take?
A: Reports range from several weeks to a few months, depending on the file and the tax office workload. Start early and prepare complete documents.
Q: Does Article 23 apply to parcels sold through IOSS?
A: No. When VAT on a low-value consignment is collected through IOSS at the point of sale, there is no import VAT to defer at the Dutch border.
