5 Common Mistakes to Avoid When Applying for the Dutch American Friendship Treaty (DAFT) Visa

We see many Americans making a successful transition into the Netherlands, working self employed under the Dutch American Friendship Treaty (DAFT) visa. Even so, the most common question people ask us : what are the biggest mistakes us Americans make in this process? Well, without further a-do …

Mistake 1: Not adapting to the self employed mind set

Many DAFTers already were self employed before they made the jump to the Netherlands. They were already used to running their own shop, now they just continue doing so in the Netherlands in either a ZZP or BV+30%. Some DAFTers, however, always kept a regular job and are now transitioning into self employment for the first time, as part of their DAFT application. A transition into self employment is a hurdle in and of itself, even without the migration part. We advise people making this double transition for the first time to spend extra time getting accustomed with the Dutch accounting and administrative responsibilities of a (small) Dutch company: do some reading, watch some videos and perhaps schedule a call with a Dutch accountant or bookkeeper. It's not rocket science (heck, millions of people do it every day), but don't underestimate that self-employed mindset: nothing happens automatically, you need to be on top of things. 

Mistake 2: Underpreparing the housing search

Housing is not strictly a requirement under DAFT (you can register at a friend or relative's house even). But in the end you will need to find a place to call home. While there is a housing crunch in the big Dutch cities, the Netherlands has space for each and every budget. You can move to the Netherlands in a short-stay, check out places with a realtor and then settle yourself in a nice place. A common mistake we see people make is leasing a place before having actually seen it live and in person, then arriving with their kids and finding it to be a leaky dump. If that is your first experience with your "new home" in the Netherlands, that's a negative experience very difficult to shake off. So we advise you to come prepared for your housing search, do a scouting trip in advance and consider hiring a real estate agent (makelaar). 

Mistake 3: Forgetting about taxes

It is only natural for a migrating family to focus their efforts on the immigration laws and regulations and the practicalities of the relocation itself. But don't forget about the elephant in the room: taxes applicable in the Netherlands / USA cross border context. Sometimes this can be a show stopper, most of the time it's more like a speeding ticket.

Some examples:
(1) Your spouse can join you under DAFT and continue their W-2 employment from the Netherlands. But that W2 income will be taxed first and foremost in the Netherlands, once your spouse starts working from here. That means the post-tax salary calculation you had back in the US goes out the window. Your spouse will be paying full Dutch income taxes, which can then be offset against any obligations towards the IRS. In this example it's highly recommended to look into employment via a local Dutch entity (either subsidiary or self-owned contracting BV) so the spouse can apply for a 30% ruling. This will make the tax treatment fall more in line with the previous US taxation.
(2) If you have many assets such as stocks, cash, crypto, real estate and retirement savings, it's worthwhile looking into the Dutch tax treatment thereof. It's recommended you reach out to a cross-border Dutch tax specialist so you know what to expect. US real estate and fixed 401(k) are usually exempt from Dutch taxation. IRS and distributions of 401(k) are usually taxed in NL.  

Mistake 4: Listening to the ol' grapevine

We live in an information age where it's very easy to obtain information about rules and regulations. And rightly so. There are many good blog articles, FAQs and videos out there, and ChatGPT does a decent job at explaining even the finer details. Yet we still hear many people paying too much attention to what they hear through the grapevine. Hearing that so-and-so had a certain experience, does not mean it translates to your situation. There are many nuances in tax and immigration rules, that can make your situation totally stand out from the other person's situation. When in doubt, please reach out to a reputable advisor. 

Mistake 5: Forgetting the apostilles

You may have heard about this one. The apostille is an extra certification on your documents that make them usable in other countries. Without an apostille, your birth certificate or marriage certificate is only usable in the country that issued the document, usually the United States. So if you want to register yourself anywhere else in the world, you must ensure these documents are accepted in that other country. Enter: the apostille. This extra certification makes your documents usable in all countries that are signatories to the 1961 Apostille Treaty, including all European Countries such as the Netherlands. If you bring birth and marriage certificates to the Netherlands without an apostille, they are simply not usable.

Bonus: things that are not actually mistakes

Despite the abundance of information, there are still some hard-to-get-rid-of misunderstandings about the DAFT visa out there. We have numbered the 3 most important ones.

1. "I have no business plan"

The IND website does a lousy job at explaining the DAFT process. Glossing over the information there could make you think you need a business plan and/or financial prognosis for the DAFT application process. That is not the case. The business plan requirement only applies to main self employed visa applications. The DAFT is an exception to this main visa where there are a lot of exemptions, including the business plan requirement.

2. "I worry about the points system. Will my application score high enough to get accepted?

The points system is another example of a requirement that does not apply for American DAFT applicants. It only applies to main self employment visa applicants, who are not exempted. American DAFT and Japanese DJFT applicants (so-called "treaty applicants") are exempted.

3. "I don't think I will have Dutch clients for my business"

This is not a requirement. The only requirement is that your business in the Netherlands generates revenues : payments received upon invoices issued. Where those clients come from is irrelevant. 

4. "I will not pass an FBI background check"

FBI background checks are not required as part of the DAFT application process. You will be cross-checked within the EU / Schengen area criminal records for felonies, not misdemeanours. DUI or marihuana convictions in the USA (yes, we hear that a lot) are not an issue in the DAFT application process. 

Need help moving under DAFT to the Netherlands? Reach out today!

Cardon & Company provides comprehensive support for your DAFT visa application, BV incorporation, and 30% ruling through our all-inclusive Dutch American Friendship Treaty + BV + 30% package. From start to finish, we handle every step, including timelines and paperwork. Reach out to us for more information.

Written by: Diederick Cardon