Peppol and VAT (BTW) in the Netherlands: What You Need to Know

The Link Between E-Invoicing and VAT

VAT (BTW -- Belasting over de Toegevoegde Waarde) is central to every business transaction in the Netherlands. Every invoice you send or receive must contain specific VAT information, and the Belastingdienst (Tax Authority) requires accurate reporting of all VAT-related data.

Peppol e-invoicing and VAT compliance are closely connected. Structured electronic invoices contain all the data needed for VAT reporting in a machine-readable format. This reduces errors, simplifies audits, and helps businesses meet their tax obligations more efficiently.

In this article, we explore how Peppol supports VAT compliance locally and what changes are coming with the EU's VAT in the Digital Age (ViDA) initiative.

VAT Requirements on Invoices

Under local law, every invoice must include specific VAT-related information. The key requirements are:

• BTW-identificatienummer (BTW-id): The supplier's VAT identification number in the format NL + 9 digits + B + 2 digits
• BTW amounts: VAT amount per rate, clearly separated
• BTW rates: The applicable rates (currently 21% standard, 9% reduced, or 0%)
• Invoice date and sequential number
• Description of goods or services
• Total amount excluding and including VAT
• KvK number: Chamber of Commerce registration number

A Peppol invoice in SI-UBL format contains dedicated fields for all of these elements. Unlike a PDF or paper invoice, the data is structured so that it can be automatically validated and processed.

How Peppol Improves VAT Accuracy

One of the most significant advantages of Peppol e-invoicing for VAT purposes is data accuracy. Consider the typical problems with traditional invoicing:

• Manual data entry errors: When an accountant manually enters invoice data into accounting software, mistakes happen. Wrong VAT rates, incorrect amounts, or mistyped BTW-ids can lead to incorrect VAT returns.
• Missing information: Paper or PDF invoices sometimes lack required fields, causing delays and potential compliance issues.
• Calculation errors: Manual calculations of VAT amounts can be incorrect, especially with mixed rates or complex discount structures.

With Peppol, all invoice data is structured and validated before transmission. The SI-UBL format enforces mandatory fields and includes built-in validation rules for VAT calculations. This means:

• VAT amounts are automatically calculated and verified
• BTW-ids are validated against the correct format
• All mandatory tax fields are present before the invoice is sent
• Data flows directly into accounting systems without manual intervention

Peppol and BTW-Aangifte (VAT Returns)

Every business must file periodic BTW-aangifte (VAT returns) with the Belastingdienst. This involves summarising all sales and purchase invoices, calculating the net VAT owed or refundable, and submitting the return electronically.

When your invoices flow through Peppol, the entire process becomes more efficient:

1. Automated data capture: Incoming Peppol invoices are automatically recorded in your accounting system with correct VAT categorisation
2. Real-time overview: You can see your VAT position at any time, not just at the end of the quarter
3. Fewer corrections: Accurate data means fewer suppletie-aangiften (corrective VAT returns) to the Belastingdienst
4. Audit readiness: All invoices are stored in a structured, searchable format that satisfies audit requirements

Most popular accounting solutions on the market can integrate with Peppol to automate VAT processing. And with Peppol Box, even businesses that use simpler bookkeeping tools can benefit from structured VAT data -- Peppol Box works alongside your existing software via CSV/XML exchange, its API, or custom integrations. Your accountant can also use Flexina Sync to automatically retrieve your invoices from Peppol Box, free of charge.

ViDA: The Future of VAT and E-Invoicing

The European Commission's VAT in the Digital Age (ViDA) initiative is set to transform VAT reporting across the EU. Key elements relevant here include:

• Mandatory B2B e-invoicing: By July 2030, all EU businesses will be required to issue structured e-invoices for cross-border and domestic B2B transactions
• Digital Reporting Requirements (DRR): Near-real-time reporting of invoice data to tax authorities, enabling the Belastingdienst to receive VAT data as transactions occur
• Updated VAT rules for the platform economy: New rules for digital platforms and marketplaces
• Single VAT Registration: Simplification of cross-border VAT obligations within the EU

For domestic businesses, ViDA means that Peppol e-invoicing will eventually become the standard for all B2B transactions, not just government contracts. The structured data in Peppol invoices is perfectly aligned with the Digital Reporting Requirements, making it the ideal foundation for future compliance.

Practical Tips for VAT-Compliant E-Invoicing

To ensure your Peppol invoices are VAT-compliant:

• Always include your BTW-id: Ensure your VAT identification number is correctly formatted and up to date
• Verify your customer's BTW-id: Use the VIES system to validate EU VAT numbers before invoicing
• Apply correct VAT rates: Double-check whether the standard (21%), reduced (9%), or zero rate applies
• Include your KvK number: This is required on all business invoices and serves as your Peppol identifier
• Use a validated Peppol provider: Choose a provider like Peppol Box that validates all VAT fields before sending