The Dutch tax system operates with the same precision as a Delta Works sluice gate, until you try to figure out whether moving your investments into a BV (private limited company) will actually save you money under the new Box 3 (wealth tax) rules. Starting in 2028, the shift from taxing fictional returns to hitting you on actual (and often unrealized) gains has turned what was once a niche strategy for the ultra-wealthy into a mainstream headache for anyone with a serious investment portfolio.
The question isn’t academic. With the new system, you might owe 36% tax on paper profits you haven’t cashed out, forcing you to sell investments just to pay the Belastingdienst (Tax Authority). Many investors wonder if a BV, which lets you defer taxes until you actually withdraw money, offers an escape route. But that route comes with its own tolls: setup costs, annual administrative fees, and a double-taxation structure that can erode your returns if you’re not careful.
The 2028 Box 3 Reality Check: Paying Tax on Money You Don’t Have
Under the current system (2026), Box 3 taxes you on a fictional 6% return for investments, minus a €59,357 tax-free allowance per person. For a single investor with €300,000 in ETFs, that means paying roughly €5,198 annually, whether your portfolio gains 15% or loses 15%. Annoying, but predictable.
The 2028 reforms change everything. You’ll be taxed on your actual dividend income, interest, and, here’s the kicker, unrealized capital gains. If your €300,000 portfolio jumps to €330,000 by December 31, you owe tax on that €30,000 paper gain. At 36%, that’s €10,800 due, even if you sold nothing and your portfolio crashes back to €280,000 on January 2.
This creates a liquidity trap. Investors report frustration at potentially needing to liquidate holdings annually to cover tax bills, especially during volatile market years. The compounding effect takes a direct hit when you’re forced to withdraw capital each year to pay taxes on gains you never realized. One analysis suggests this could add 17 extra working years to reach pension goals for some savers.
How a BV Actually Works for Investments
Moving investments into a BV shifts you from Box 3 to Box 2 (dividend tax) and corporate tax (VPB). Here’s the mechanics:
- Your BV pays 19% corporate tax on profits up to €200,000, then 25.8% above that threshold
- You personally pay 24.5% dividend tax on distributions up to €68,843, then 31% on higher amounts
- Critically: no personal tax until you actually withdraw money
The magic is tax deferral. If you earn €30,000 in dividends and unrealized gains inside your BV, you pay €5,700 in corporate tax (19%). The remaining €24,300 keeps compounding. In Box 3, you’d pay €10,800 immediately and lose that compounding power forever.
But this deferral comes at a price. Annual BV costs, bookkeeping, tax filings, chamber of commerce fees, and potential accountant stamps, typically run €1,500 to €3,000 per year. For smaller portfolios, these fixed costs can wipe out any tax advantage.
The Break-Even Math: When Does a BV Actually Win?
Let’s cut through the speculation with real numbers. One investor built a simulator testing different wealth levels against various BV costs. The results reveal clear thresholds:
The €150,000 Portfolio: Don’t Bother
At this level, Box 3 costs you about €1,958 annually. A BV with €2,000 in yearly fees plus €570 in corporate tax on a 7% return totals roughly €2,570. You’re paying €600 more for the privilege of extra paperwork. The compounding benefit is too small to justify the complexity.
The €300,000 Sweet Spot: Maybe, If You’re Patient
Here, Box 3 hits you for €5,198. A BV with €2,000 costs and €1,140 in corporate tax totals €3,140. That’s a €2,000 annual saving, significant, but only if you don’t need the money immediately. The real power emerges over 20 years: reinvesting that €2,000 difference annually at 7% growth adds tens of thousands to your final wealth.
This is where the math gets personal. If you’re building wealth for retirement and can leave profits in the BV, the structure makes sense. If you need regular withdrawals, the double taxation (corporate tax + dividend tax) often makes Box 3 cheaper.
The €500,000+ Territory: BV Becomes Compelling
At higher wealth levels, the math strongly favors a BV. With €500,000 invested, your Box 3 bill approaches €8,500 annually. Even with €3,000 BV costs, you’re saving substantially. For volatile assets like growth stocks or crypto, the advantage is dramatic, one calculation showed a €6 million difference over 10 years for a €100,000 Bitcoin investment, because the BV structure avoids selling during dips to pay tax on previous year’s gains.
The Hidden Costs That Destroy the BV Advantage
The break-even calculations assume you keep costs low. Many investors severely underestimate what a BV actually costs:
- Setup: €850 for KVK registration, notary fees for share capital
- Annual fixed costs: E-herkenning (€60), LEI code (€77), corporate bank account fees (€150)
- Accounting: €1,200-€3,000 for annual statements and tax returns
- Agio storting: Free to deposit, but costly to extract later
One investor reported keeping total costs under €300 annually by doing everything themselves with family help. But this requires serious financial literacy and time commitment. Most people pay €1,500+ for professional help, which shifts the break-even point higher.
The Strategy Nobody Talks About: Agio Loans
Here’s where Dutch tax planning gets creative. Some investors structure their BV with an agio storting (share premium deposit), then have the BV lend that money back to themselves at commercial interest rates (say 7%). You pay the interest to your own BV, which is taxed at 19% corporate rate. Meanwhile, you deduct the interest from your Box 3 income, potentially zeroing it out.
The catch? You must pay that interest even in losing years. If your investments drop 20% but you still owe €7,000 interest to your BV, you’re stuck paying tax on that interest income in the BV (19%) plus eventual dividend tax (24.5%), an effective rate of 38.8%, worse than Box 3’s 36%. This strategy only works with consistently high returns.
The Real Answer: It Depends on Three Factors
After analyzing dozens of scenarios, the BV decision hinges on:
- Wealth Level: Below €250,000, probably not worth it. Above €400,000, increasingly attractive.
- Investment Strategy: High-growth, volatile assets benefit most from tax deferral. Conservative bond portfolios see less advantage.
- Time Horizon: The longer you can leave money in the BV without withdrawals, the bigger the compounding benefit.
For a 22-year-old ZZP’er (freelancer) building toward €2 million retirement wealth, starting a BV early might make sense, if they can keep costs low and won’t need the money for decades. For someone nearing retirement who needs annual income, Box 3 often remains simpler and cheaper.
Actionable Steps Before You Make the Leap
Before rushing to form a BV, run these numbers:
- Use the Jullie Waarde calculator to model your specific wealth and return assumptions
- Get quotes from three accountants for annual BV administration, don’t assume €1,500
- Calculate your 2028 Box 3 liability under the new rules with your expected returns
- Model both scenarios over 10+ years, including eventual dividend tax in the BV path
The political landscape adds uncertainty. The 2028 reforms face opposition, and some investors worry about regime risk, what if rules change again after you’ve locked yourself into a BV structure? This fear alone pushes some to stick with Box 3 despite the disadvantages.
The Bottom Line
Forming a BV for investments under the new Box 3 rules isn’t the slam-dunk it might appear. For wealth between €300,000 and €600,000, it’s a genuine toss-up dependent on costs and withdrawal needs. Above €600,000 with a long-term horizon, the BV advantage becomes hard to ignore. Below €250,000, it’s usually an expensive complication.
The real winners aren’t just those with high wealth, but those who can minimize administrative costs and maximize compounding time. If you can’t do both, Box 3’s simplicity might be worth the higher tax bill.
For deeper analysis of how the 2028 changes specifically affect freelancers and DGAs, see our direct analysis of how the 2028 Box 3 changes affect BV formation decisions. Those wanting to understand the broader wealth tax implications should read our overview of the 2028 Box 3 reforms and their impact on wealth taxation. And if you’re still grappling with the deemed return calculations, our detailed explanation of the 6.37% deemed return and how it affects savers breaks down the numbers in plain English.
The Dutch tax maze isn’t getting simpler. But with careful calculation and honest assessment of your situation, you can at least choose your path deliberately rather than stumbling through it blind.
