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If you run a business abroad and intend to assign employees to your Dutch branch or customer on a temporary basis, you may have to deal with Dutch government rules and regulations. You can use this checklist to see what possible obligations you may have. This checklist is intended for temporary employment agencies, secondment agencies and other businesses assigning employees to the Netherlands.
European directives such as the Posting of Workers Directive and the Directive on the enforcement of the Posting of Workers Directive are applicable as well. In the Netherlands, these directives have been implemented in the Terms of Employment Posted Workers in the EU Act (Wet arbeidsvoorwaarden gedetacheerde werknemers, WagwEU). You can find more information about the Posting of Workers Directive and the Dutch implementation of this Act on the Ministry of Social Affairs and Employment's website.
This checklists is merely a guideline. You may be subject to other obligations as well or you may have to follow the steps in a different order. For further information on tax matters, please contact the Dutch Tax and Customs Administration (Belastingdienst). Temporary employment agencies will find information in English on the Dutch Association of Temporary Work Agencies' website (ABU).
1. Check whether your employees meet the conditions for residence in the Netherlands
Your employees may need a residence permit or a visa to reside in the Netherlands. They must register with the local municipal authority if they remain in the Netherlands for longer than 4 months.
2. Check whether your employees have the professional qualifications required in the Netherlands
Certain professions may only be practised in the Netherlands if your employees have the correct qualifications. They must have this certificate officially recognised by the competent authority in the country where they obtained it.
3. Apply for work permits
You must apply for work permits for your employees if they are from outside the EEA/Switzerland. If your business is based in the EEA or Switzerland, however, these work permits are not required, but you do have a duty of notification.
4. Find accommodation for employees with a work permit
You are obliged to find suitable accommodation for employees who need a work permit. In doing so, you must comply with the rules of the municipality where your employees will be working.
5. Apply for A1/(E)101 statements
If your employees work in the Netherlands on a temporary basis, they can sometimes remain insured for social security purposes in the country where your business is based. For this purpose you will need to apply for an A1/(E)101 statement.
6. Check whether your employees must take out healthcare insurance
If your employees cannot obtain E101/A1 statements, they will be insured for social security purposes in the Netherlands and you must withhold the relevant contributions from their wages. In that case, your employees will also be obliged to take out health care insurance in the Netherlands.
7. Register with the Dutch Tax and Customs Administration
In most cases, you are obliged to pay payroll tax in the Netherlands for your employees. Sometimes you must also pay VAT. For this purpose you must register with the International Office of the Dutch Tax and Customs Administration.
8. Apply for tax and social insurance numbers from the Dutch Tax and Customs Administration
To be able to pay payroll tax, you will need each employee’s citizen service number or tax and social insurance number. They have to collect this number personally – by appointment – from the Tax and Customs Administration.
9. Make sure that your customer is not held liable for the payroll tax
If you do not pay your payroll tax, your customer will be held liable. To prevent liability for payroll tax and turnover tax, your customer may ask you to set up a blocked account (G account) with the Dutch Tax and Customs Administration.
10. Check whether a Collective Labour Agreement applies to your business
Some sectors in the Netherlands have concluded a Collective Labour Agreement (CAO). If the CAO has been declared mandatory by the Ministry of Social Affairs and Employment, you as a foreign employer must observe a number of key provisions.
11. Pay at least the minimum wage and holiday allowance
Everyone working in the Netherlands is entitled to the statutory minimum wage and a holiday allowance. As a foreign employer, you also have to pay at least this minimum wage.
12. Comply with the rules on working hours and holiday entitlements
You must comply with the Dutch Working Hours Act with regard to your employees in the Netherlands. This Act states how many hours your employees may work on a daily and weekly basis. Your employees are also entitled to a minimum number of days’ leave on full pay.
13. Fulfil your payroll tax obligations
You are obliged to keep payroll records for the Dutch Tax and Customs Administration and to file payroll tax returns. Once you have registered with the Tax and Customs Administration, you will receive an invitation to file a tax return.
14. Check whether you must charge VAT
You may have to charge your customer turnover tax (VAT) for the services performed by your employees in the Netherlands. In that case, you have to file VAT returns in the Netherlands. However, sometimes the VAT levy is reverse-charged to your customer and you are not required to pay VAT.