You’ve got the itch. You have an idea, a passion or a dream you no longer want to ignore. Your own business means freedom, making all the decisions yourself and building something that’s truly yours. But that permanent job with a monthly salary is very comfortable too. Holiday leave, insurance and pension are arranged automatically. That way your days off really are days off. And you also sleep a little easier with financial stability, especially if you’ve just bought a house or are running a family.
Not sure what the best choice is? Who says you have to choose? But before you jump in at the deep end, there are a few things you should check first.
1. Check your contract: are you allowed to take on side work?
Before you unleash your creativity on a business plan, it’s smart to dive into the paperwork first: the employment contract for your permanent job. Some employers have rules about secondary work. You may need permission, or you may not be allowed to do anything that competes with your job.
Tip: Read the contract carefully and talk to your employer. Openness and transparency prevent hassle and keep you on good terms with your boss.
2. Two incomes, one tax assessment
As an employee, you pay tax through your payslip. But once you earn freelance income on top of that, things get interesting for the Tax Authority (Belastingdienst). Your total income goes up, and no tax has been paid yet on that extra income.
Note: The extra tax is only claimed after you file your return, so set enough money aside in good time.
3. Putting in the hours = reaping the benefits
Thinking of tax benefits such as the self-employed deduction (zelfstandigenaftrek) or the starter deduction (startersaftrek)? Then you do have to meet the hours criterion (urencriterium). You need to put at least 1,225 hours a year into your business to get those benefits. That’s an average of 24 hours a week. Fortunately, you may also count indirect hours, such as time spent building a website, marketing, networking, admin, training, etc.
Note: You must put as many hours into your business as the number of hours you work as an employee. So if you work 32 hours a week as an employee (1,664 hours a year), you also need to put 1,664 hours into your business to qualify for the zelfstandigenaftrek. Just started? Then you can use the startersaftrek (subject to the urencriterium).
You are, however, always entitled to the SME profit exemption (mkb-winstvrijstelling) (in 2025: 12.7% of your profit) and possibly to the investment deduction. So even if you don’t meet the urencriterium, there are benefits to be had.
4. To KOR or not to KOR
Do you expect turnover below €20,000? Then you can apply for the small business scheme (KOR). With it, you don’t have to charge VAT or file VAT returns.
Note: You can then no longer deduct VAT on business expenses either. And for your business clients it can actually be a disadvantage, because they can’t reclaim VAT on your service/product. That effectively makes you more expensive for them and may tip them towards choosing someone else after all. So weigh up carefully whether the KOR is worth it.
5. Don’t forget your bookkeeping
Even if you only run your business for a few hours a week, you need to keep your bookkeeping in order. Invoices, receipts, car journeys, hours: keep track of all of it. That way you avoid discussions with the Tax Authority later.
Tip: Open a business bank account and keep your income and expenses separate from your private life to avoid confusion.
Conclusion: just go for it, but get it properly arranged!