Converting a sole proprietorship into a BV: at what profit does it pay off?

At some point the question comes up: should I convert my sole proprietorship into a BV? Often driven by a good year, or by a client who only works with BVs. The short answer is that, purely on tax, it only pays off from a fairly substantial profit, but liability and growth plans can weigh just as heavily. Below we set out the tipping point, the DGA salary and the two ways of contributing your business.

The tipping point: at what profit does a BV pay off?

As a rule of thumb, the tipping point lies roughly between €90,000 and €120,000 annual profit. Below that level a sole proprietorship is usually more tax-efficient, mainly because of the self-employed deduction (zelfstandigenaftrek) and the SME profit exemption (MKB-winstvrijstelling). Above that level, the combination of corporate income tax in the BV and box 2 tax on dividends starts to work out more favourably than income tax in box 1.

It is explicitly a rule of thumb, not a law. Where your personal tipping point lies depends on how much profit you leave in the business, whether you use a holding company, and your personal situation. The exact rates shift every year, so for a calculation you are best off using the current figures from the Dutch Tax Administration (Belastingdienst), or putting it to your accountant.

It isn't just tax

Money is not the only reason to switch. Three other considerations often weigh just as heavily:

• Liability: with a sole proprietorship you are personally liable for debts, with a BV in principle not.
• Shares: if you want to give co-founders or investors a stake, you need a BV, because a sole proprietorship has no shares.
• Image: some clients and banks prefer to work with a BV.

Still torn between the two legal forms? Read the article bv-of-eenmanszaak first. If you are toying with growth plans or an exit, wanneer-een-holding is relevant before you fix the structure.

Factor in the DGA salary

Once you have a BV and work for it yourself, you are a director-major shareholder (directeur-grootaandeelhouder, DGA) and must pay yourself a customary salary (gebruikelijk loon). The guideline for 2026 is €58,000. You simply pay wage tax on it, regardless of how much profit remains. In some situations that salary may be lower, but you must be able to justify it.

This DGA salary is exactly why a BV is rarely advantageous at lower profits: a large part of your profit goes out the door as salary anyway and is taxed normally.

Taxable or tax-free contribution

When converting, you contribute your existing business to the BV. That can be done in two ways, and the choice determines whether you have to settle with the tax authorities now.

With a taxable contribution (ruisende inbreng) you settle tax on the hidden reserves and goodwill of your sole proprietorship. That can cost tax at the moment of conversion, but also gives you a clean start in the BV and sometimes cessation relief (stakingsaftrek). With a tax-free contribution (geruisloze inbreng) you pass that tax claim on to the BV and don't settle now; in return you carry over the old book values. Tax-free is popular with businesses that have sizeable hidden reserves; taxable can actually be favourable if the reserves are limited.

How the notarial conversion works digitally

Setting up a BV without a notary does not exist: the notarial deed is a legal requirement. What has changed is that since 2024 you never have to visit the notary in person again. The deed can be executed entirely remotely.

At Digital Notary you arrange the incorporation of the new BV entirely online with a real, recognised civil-law notary (Berger Notariaat). You identify yourself digitally via Sumsub (ID photo, liveness and background check) and sign with a qualified electronic signature (QES) under eIDAS, legally equivalent to a handwritten signature throughout the EU. The onboarding takes about 20 minutes; the lead time is four to seven working days.

A misconception that is still doing the rounds: you supposedly need €18,000 in starting capital. That hasn't been true since 2012; the legal minimum is €0.01. KvK registration costs €85.15 in 2026.

If you also want a holding company above your operating BV right away, that is a toggle in the process: Pro + Holding costs €300 extra, one-off, with no extra monthly fee, and the holding company is incorporated in the same process. We set up the legal structure and keep your shareholder register audit-proof on the Nxchange infrastructure (AFM-regulated). You coordinate the tax side of converting your sole proprietorship (the contribution itself) with your own accountant or tax adviser.