{"id":2209,"date":"2026-02-01T09:03:00","date_gmt":"2026-02-01T09:03:00","guid":{"rendered":"https:\/\/wwwstaging.keesdeboekhouder.nl\/when-do-you-grow-from-sole-proprietorship-to-limited-liability-company\/"},"modified":"2026-03-11T13:12:17","modified_gmt":"2026-03-11T13:12:17","slug":"when-do-you-grow-from-sole-proprietorship-to-limited-liability-company","status":"publish","type":"post","link":"https:\/\/www.keesdeboekhouder.nl\/en\/when-do-you-grow-from-sole-proprietorship-to-limited-liability-company\/","title":{"rendered":"When to expand from a sole proprietorship into a bv?"},"content":{"rendered":"\t\t
\n\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

Your business is doing well: profits are growing considerably, and maybe you\u2019ve even had to hire employees by now. You\u2019ve once heard or read somewhere that it could be wise to transition into a bv (private limited company) at some point. But exactly how does that work? What are the benefits, and at what point should you take that step? We\u2019ll explain everything in this blog.<\/strong><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

\n\t\t\t\t
\n\t\t\t\t\t\t\t
\n\t\t\t\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

Liability<\/strong>
The biggest advantage of converting a sole proprietorship (or general partnership) to a bv (private limited company) is, as the name suggests, the limitation of your personal liability as an entrepreneur. What does that mean? As a sole trader, you\u2019re fully personally liable for any debts of the company, and possible creditors of the company are able to recover claims from your private assets (such as savings or your home). As the company increases in size, the risk of being held personally liable may also increase. With a bv, the liability of the company is, in principle, limited to the assets of the bv. Because a bv is an independent entity, creditors of the bv can only hold you, as the director-majority shareholder, privately liable for business debts in exceptional cases.<\/p>

Taxes<\/strong>
If you have a sole proprietorship, you pay income tax on the profits from your business (up to 49.5%). However, as an independent entrepreneur you\u2019re entitled, under certain conditions, to a number of tax benefits for income tax, such as tax relief for new businesses, private business ownership allowance, and SME profit. As a result, you pay less income tax, up to a certain profit level, than when you\u2019re employed. If your profit continues to grow, at a certain point it may be more interesting from a tax perspective to convert the company to a private limited company, since profits of private limited companies are taxed in a different way.<\/p>

In the case of a bv, the annual profit is first taxed with corporation tax (19% on profits up to \u20ac 200,000 and 25.8% on higher profits). If the profit after corporation tax is subsequently paid out as dividend by the bv to you as a shareholder of the bv, another dividend\/income tax will be levied on this dividend (a total of 24.5% on a dividend up to \u20ac 68,843, and 31% on the rest). This dividend\/income tax is only due if the dividend is actually paid out by the bv. To prevent you from having no income, and therefore being entitled to allowances for example, you, as a director-majority shareholder who works for his own bv, are obliged to pay yourself a salary.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t

\n\t\t
\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\"\"\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t
\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

Advantages of a bv<\/strong><\/p>