Learn Dutch: Het is het innerlijk dat er echt toe doet. - It is the inner character that really matters.

The verb ertoe doen (to matter) contains an intrinsic er. In a relative clause starting with dat, the conjugated verb (doet) goes to the end. The er part prefers to sit early in the clause, directly after the relative pronoun. This leaves the adverb echt (really) sitting between er and toe doet.

What is the full dictionary form of the verb used for 'matters' here?

The full infinitive is ertoe doen. It is a fixed expression where er is a permanent, built-in part of the verb. If you drop the er, the words toe doen on their own no longer mean 'to matter'.

Why do we use the word dat here instead of die?

The word dat is a relative pronoun referring back to het innerlijk (the inner character). Because innerlijk is a het-word, you must use dat to say 'that' or 'which'. You would only use die when referring back to a de-word.

Could we keep ertoe together and write dat echt ertoe doet?