A question that many entrepreneurs ask themselves is: can I buy a suit in the name of the company?
The answer is yes, but there are some snags in the Netherlands that you have to comply with. That is why it is good to read carefully before you make the choice to put the purchase of a suit in the name of the business. After all, you don't want to be faced with surprises. That is why we explain in this article what are the requirements.
How does that work exactly?
Occasionally the tax system in the Netherlands is a bit complex and sometimes difficult to decipher.
It is also not easy with company clothing.
It goes without saying that you can purchase a two or three-piece suit for business purposes without any problems. After all, you buy the suit for business use. But the tax authorities do not immediately agree with that.
The case is that there are strict rules for workwear. If you do not comply with these rules, the purchase of your suit does not fall under work clothing and you may therefore not deduct it from the profit without being taxed for it.
Rules for corporate clothing
The 2 main categories of clothes that you can purchase in the company's name are the following.
- Clothing that serves as work clothing (for example, for an overall or work jacket, this is easy to determine); or
- Clothing that is provided with one or more clearly visible company logos with a combined surface area of at least 70 cm² (per item of clothing).
There is only one exception to the above rules that is important for you as an entrepreneur to determine whether you purchase the suit for business or private purposes because if the suit is purchased in the company's name, you will not pay takes on it.
When checked by the tax authorities, you must demonstrate that the purchased men's suit is only worn at the office and remains there when you go home. So that's going to turn things around. 😉
, an extensive document about payroll tax 2020Download
What do I have to do to meet the requirements?
- Make sure that the invoice for the purchase of your suit is in the name of the business. Do you order from us? Then you can easily enter the company name on the checkout page.
- Do you have your suit picked up from the office from time to time to have it dry cleaned? Then make sure that you have a receipt with which you can prove this.
- Leave your suit in the office and change in the office. Just like with everything you have to justify to the tax authorities, you must also be able to justify this properly. (So make it plausible that you change yuor clothes there)
Can I order my business suit online?
As with many other products, you can also buy a suit these days through an easy online ordering process. At The Garrison, for example, we have a size tool to find out which size suits you best.
You can then order that size and try it on. Do you still need a size larger or smaller? Then you can exchange the suit easily and free of charge via our return portal.
Buying a business suit outside the Netherlands
You do not live in the Netherlands but you want to buy a suit in the name of the company? Then the VAT must be transferred to the country where the item is purchased. Is your company located in Belgium and you want to make a business purchase? Then the VAT must be transferred to Belgium. You therefore do not pay VAT in the country where the purchase takes place.
Do you want to purchase a business suit at TheGarrison.nl? Then you can easily transfer the VAT by entering your VAT number at EU VAT number. You can do this when paying for your items.
If you enter a valid VAT number, the VAT will be deducted from the amount and transferred to the country where the purchase is made. Make sure that you perform these steps during the accounting process.
Is it wise to put the suit on the name of the company?
As discussed above, it is certainly possible to purchase a two-piece or three-piece suit at the store. But it is good to ask yourself whether you are really going to comply with the rules.
Do you want to go to your brother's wedding with your suit without any problems? Then it might be better to purchase it privately. You pay a little more, but you don't have to account for where and when you wear your suit.
Very comfortable right? 🙂