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If you run a business abroad and intend to assign employees to your Dutch customer or branch 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 all businesses posting workers to the Netherlands temporarily. Examples include temporary employment agencies, secondment agencies, construction firms, or manufacturers.
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 checklist 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 can contact the Dutch Association of Temporary Work Agencies(ABU, in Dutch).
1. Check whether your employees meet the conditions for residence in the Netherlands
Your posted worker may need a residence permit or a short-stay visum to reside in the Netherlands, if they are from a non-EU/EEA country. They must register for a Citizen service number (BSN) in the town where they reside during their time in the Netherlands if they remain 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 posted workers if they are from outside the EEA/Switzerland. If your business is based in the EEA or Switzerland, these work permits are not required, but you do have to notify the Ministry of Social Affairs and Employment.
4. Find accommodation for your posted workers
You have to find suitable accommodation for those 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 you post employees 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.
Duty to report not yet in place
Part of the WagwEU is the duty to report. To quote the SZW inspectorate website: "foreign service providers must report in advance about where and when and with which employees work will be performed in the Netherlands. The service recipient in the Netherlands has to check whether the report has been made and whether it is correct." For the full text on enforcement, see the SZW Inspectorate website.
However, there is as yet no digital system available to submit the report to. This means that you as a service provider do not have to submit reports, not does the service recipient have to verify them.
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.