The VAT franchise: invoicing without VAT, and what it costs
Belgium, Luxembourg and the Netherlands each run a franchise scheme: below a turnover threshold specific to each country, you invoice without VAT. No periodic return, no VAT to pay over. Attractive — provided you understand the trade.
What you gain
Simplicity, first: no VAT to compute, charge or declare. And a very real price advantage when your clients are consumers: your price is your price, without the percentage a VAT-registered competitor has to add.
What you lose
The counterpart fits in one sentence: who charges no VAT deducts none either. The equipment, the laptop, the software subscription, the car: the VAT paid on your purchases stays yours, for good.
The scheme therefore favours businesses that spend little. The heavier your professional costs, the more the franchise quietly costs you.
The detail that matters: your clients
With business clients the price advantage vanishes: they deduct VAT anyway, so your "VAT-free" invoice saves them nothing. You keep the simplicity, but you still carry the non-deducted VAT on your own purchases.
The franchise is therefore mostly interesting in B2C, or early on while turnover is still modest.
The threshold is monitored, not endured
The real risk of the scheme is not choosing it: it is crossing the threshold without noticing. The crossing does not announce itself; it is discovered, sometimes months later, with invoices to regularise.
It is a figure to track continuously against your real turnover — exactly the kind of watching a tool does better than a human busy working. Lumohub tracks your position against your country's threshold and warns you before the line, not after.