Americans in the Netherlands: Living, Working & Moving
For Americans considering a move to Europe, the Netherlands is worth a closer look. It's a small, prosperous country with an international outlook, an excellent infrastructure and a way of life that is quite different from what most Americans are used to.
The Netherlands also happens to be one of the easiest European countries for Americans to immigrate to. Thanks to a special treaty between the United States and the Netherlands, American entrepreneurs and freelancers have access to a remarkably straightforward residence permit.
Why do Americans move to the Netherlands?
For starters, practically everyone speaks English. The Dutch start learning English at a young age and are exposed to American and British culture throughout their lives. This means everybody, from cleaners to CEOs, from toddlers to grandparents, are well able to converse in English. Although you can comfortably get by without speaking a word of Dutch, learning the language will certainly help you integrate into Dutch society.
The country is also remarkably well connected. Amsterdam's Schiphol Airport is one of Europe's largest international airports, while cities like Paris, Brussels and London are only a few hours away by train. The Netherlands itself is small enough that you can travel between most major cities within an hour or two.
And then there's the Dutch attitude towards life. The Dutch have a reputation for being practical, independent-minded and rather direct. They don't particularly care about your social status or how much money you make. You might find your Dutch neighbor driving a fifteen-year-old bicycle despite having a six-figure salary and a perfectly good BMW in the garage. For Americans accustomed to a more status-conscious society, this can take some getting used to.
Life in the Netherlands: what's different from America?
Healthcare is a major difference. The Netherlands has a universal healthcare system based on mandatory private health insurance. Residents who fall under the Dutch insurance obligation take out a basic insurance policy with a commercial insurer, with coverage regulated by the government. Medical treatment is generally accessible without the kind of financial uncertainty Americans may be familiar with.
Education is another consideration, particularly for American families with young children. Dutch public schools are government-funded and generally of a high standard. International schools are also available, although these can be expensive. Most American children who move to the Netherlands at a young age will pick up Dutch surprisingly quickly.
Of course, not everything is better.The Netherlands has a serious housing shortage in the mid-range market. Finding a suitable rental apartment in nice cities and neighborhoods can therefore be difficult and expensive, particularly when you are bringing a large family and/or a furry friend.
Can Americans move to the Netherlands?
An American passport allows you to visit the Netherlands without a visa for up to 90 days within a 180-day period, subject to the applicable Schengen rules. But visiting the country and actually moving here are two different things.If you want to live and work in the Netherlands, you generally need a Dutch residence permit.
There are several ways to obtain one. Americans who receive a job offer from a qualifying Dutch employer may be eligible for a Highly Skilled Migrant visa or an EU Blue Card. Those with a Dutch or European partner may qualify for a residence permit based on their relationship.
But what if you don't have a Dutch employer or partner? What if you are self-employed, work remotely for American clients, or already have your own business in the United States? This is where things become particularly interesting.
The Dutch American Friendship Treaty: an unusually easy immigration route
In 1956, the Netherlands and the United States signed the Dutch American Friendship Treaty, commonly referred to as DAFT. The treaty was intended to strengthen the economic relationship between the two countries. Almost seventy years later, it continues to provide American citizens with a special immigration opportunity.
Under the Dutch American Friendship Treaty (DAFT), Americans who establish a business in the Netherlands can obtain a Dutch residence permit under considerably more favorable conditions than entrepreneurs from most other countries.Unlike the regular Dutch self-employed residence permit, the DAFT procedure does not require you to prove that your business offers exceptional economic value to the Netherlands.
You don't need to create jobs for Dutch workers, raise venture capital or come up with an innovative startup concept. You’re not obliged to service Dutch or American clients (although you can, of course). There’s also no preclusion from “competing locally”, as can be seen in other Southern European visa options.
Your business can be surprisingly ordinary. An American graphic designer working for clients in California can qualify. So does a tattoo artist looking to ply their trade in an Amsterdam ink parlor. So can a marketing consultant, software developer, freelance writer or small business owner who wants to continue working with existing American customers from the Netherlands.
The important distinction is that you must actually be self-employed. Simply working remotely as a regular American W-2 employee does not qualify you for DAFT, unless you are able to switch that W-2 into 1099 (with a little help from your employer).
What are the requirements for the DAFT visa?
The basic requirements are relatively straightforward:
You must be an American citizen. Holding a valid U.S. passport is sufficient. You don't have to have been born in the United States.
You must establish and operate a business in the Netherlands. This can be a sole proprietorship (eenmanszaak, or ZZP) or a Dutch limited liability company (BV).
You must invest €4,500 in your Dutch business. For the usual business structures, this is the required minimum business capital. It remains your company's money, rather than a payment to the Dutch government, and must remain invested in the business.
You must meet the general immigration requirements. These include the applicable public-order requirements and the conditions attached to your residence permit.
And that's largely it. There is no Dutch language examination for the initial DAFT application, and you do not need a Dutch employer to sponsor your immigration. The initial DAFT residence permit is valid for two years. It can subsequently be extended for another 5 years, provided you continue to meet the requirements and operate an active business. During the course of this period, you can apply for permanent residence after 5 years in the Netherlands.
The Dutch immigration authorities currently allow qualifying first-time treaty applicants to complete the business registration and investment after the initial approval, within a six-month deadline. This makes it possible to start the immigration process before every practical aspect of your Dutch business has been arranged. We explain the process in more detail in our five-step guide to the Dutch American Friendship Treaty visa.
Bringing your family to the Netherlands under DAFT
One important advantage of the DAFT visa is that you can bring your family. Your spouse or qualifying partner and minor children can generally apply for residence permits to join you in the Netherlands. Your partner does not need to be an American citizen. Interestingly, the position of your partner is actually more favorable when it comes to employment.
As the main DAFT applicant, your right to work is tied to self-employment. Your accompanying partner, on the other hand, can generally take up regular employment with a Dutch company or start a business of their own. Children can attend Dutch schools, and the family can build a normal life in the Netherlands, rather than having to rely on successive short-term visitor stays. For Americans considering relocation with their families, this makes DAFT particularly attractive.
What about taxes for Americans living in the Netherlands?
The United States taxes its citizens on their worldwide income, even when they live abroad. The Netherlands also taxes residents on income and, depending on the circumstances, certain assets. Fortunately, the two countries have a double-taxation treaty and there are mechanisms to prevent or reduce double taxation. This covers most situations, but if you have American retirement accounts, investments, business interests and similar passive income sources, you would be well advised to look into Dutch wealth tax under so-called Box 3 taxation. Things are moving rapidly in this particular tax-field, so any information you read may become obsolete fairly quickly. We therefore recommend you talk to Dutch-side tax advisors if you are serious about this move.
For self-employed Americans, there is another important decision to make: whether to establish a Dutch sole proprietorship or a BV. The BV can be particularly interesting for Americans who qualify for the Dutch 30% ruling, a tax facility allowing qualifying employees to receive up to 30% of their eligible employment remuneration tax-free, subject to the applicable limits.
A DAFT applicant operating through a BV may be eligible for the 30% ruling if they meet the separate tax requirements. This requires careful planning because the employment arrangement and recruitment from abroad must be properly established. Starting the process only after moving to the Netherlands can put eligibility at risk.
So, should you move to the Netherlands?
If your idea of a better life involves a large house, low taxes, year-round sunshine and plenty of space, the Netherlands may not be the obvious choice. But if you value personal freedom, good infrastructure, international travel, accessible healthcare and a society where work doesn't necessarily dominate your entire life, there is a lot to like.
For Americans who are already self-employed, the immigration aspect is perhaps the least difficult part of the move. Thanks to the Dutch American Friendship Treaty, you can establish a genuine business in the Netherlands and obtain a residence permit without the usual obstacles involved in European business immigration.
Of course, relocating to another country remains a significant decision. You will have to find housing, arrange health insurance, deal with the Dutch tax authorities and get accustomed to a different culture.Our advice? Come over for a couple of weeks. Visit Amsterdam, but also explore the smaller Dutch cities. Take a train, rent a bicycle, visit a supermarket and see what everyday life is actually like.
And if you decide the Netherlands is the place for you, the immigration part may turn out to be easier than you expected.
Cardon & Company is an Amsterdam-based legal services firm specializing in Dutch business immigration. We assist American entrepreneurs, freelancers and their families with DAFT residence permit applications, Dutch company formation and the related tax considerations. If you are considering a move to the Netherlands, contact us to discuss your options.
