BV or Sole Proprietorship: Don’t Let a Legal Form Fool You

The False Comfort of a BV

In the past few months, I’ve seen an unmistakable trend: entrepreneurs abandoning their sole proprietorships and rushing to set up a private limited company (BV). The Chamber of Commerce reports a 21% increase in new BVs in Q2 2025, while sole proprietorship registrations fell by 16%.

Many believe the BV is a shield, protection from the new crackdown on bogus self-employment. Unfortunately, that belief is wrong. The assessment criteria for bogus self-employment are the same whether you work as a sole proprietor or through a BV.

If you’re working under the authority of your client, in conditions similar to employment, you are an employee in the eyes of the law, BV or not.

January 2025: Enforcement Is Real

Since January 2025, the Dutch Tax Authorities have reintroduced active enforcement against bogus self-employment.

• This year, there’s a “soft landing”: no fines issued yet.
• But the risk is already on the table. Employers (your clients) could face financial surcharges for using self-employed workers in roles that are actually employment relationships.
• Once the grace period ends, both you and your clients could feel the impact, in money, in contracts, and in reputation.

A BV won’t save you from an audit or an adjustment.

Why This Matters for Micro and Small Businesses

For small entrepreneurs, the choice of legal form is often about tax optimization, liability, and growth planning. Those remain valid considerations. But when it comes to bogus self-employment, structure is irrelevant.

You can have a BV, a contract, and a logo, but if your day-to-day reality looks like you’re just another employee on the team, the Tax Authorities will see through it.

This has two big implications:

1. Your clients might think twice before hiring you, especially in longer assignments.
2. You risk losing business if you can’t clearly show independence in how you work.

The Numbers Behind the Shift

Between April and June 2025:

• Nearly 25% more entrepreneurs closed their businesses compared to last year.
• New business registrations fell 13%.
• Yet, the total number of active companies is still 1% higher than in June 2024.

This means we’re not in a collapse, but we are in a correction. The market is adapting to new compliance realities.

Practical Takeaways

• Don’t choose a BV just to “solve” bogus self-employment risk, it doesn’t work.
• Review your contracts and working arrangements for signs of authority and dependency.
• Keep your independence visible: multiple clients, your own tools, your own schedule.
• Communicate clearly with clients, they are just as exposed as you are.

Final word: In compliance, illusions are expensive. The BV is a great tool for some goals, but it is not a disguise against the rules. If you don’t structure your work relationships correctly, the Tax Authorities won’t care what’s printed on your Chamber of Commerce registration.