Avoid false self-employment

False self-employed professionals are people who are registered as entrepreneurs in the Dutch Business Register (Handelsregister), but who actually exercise a professional activity under the authority of an employer. There are two situations in which this can happen:

1. Some employers will offer you a job on condition that you register with KVK and become a self-employed professional (zelfstandige zonder personeel, zzp’er). They then hire you as a zzp’er instead of employing you. By hiring you as a zzp’er, the company does not need to pay social security premiums or payroll taxes, or keep records of hiring you as an employee. You will not receive payment when you are sick; you are not entitled to paid holidays. Nor are you protected against dismissal; you do not build up pension rights. You need to pay your own social premiums. Your employer has no obligations towards you.
2. The other situation is when you really are a self-employed professional and you are hired by a company for a certain job. However, one or more of the following conditions also apply:

   • your client determines how you do the assignment; they have the authority;
   • you have committed to doing the job yourself, you cannot send someone else;
   • you receive a salary from the client, a fixed wage per month, or even when you are sick.

The Netherlands Tax Administration (Belastingdienst) will assess the situation as one of employment rather than independent entrepreneurship.

Real zzp’ers are in charge of their own business: you decide when and how you work and whether you perform the work yourself or outsource it. If you only have one client, occupy a desk in their office and follow instructions on how to do your job, you are in danger of slipping into the grey area of false self-employment. Check if you are employed on the Tax Administration website (in Dutch).

Employment competition

The Dutch government wants to put false self-employment to an end, as it causes employment competition. Because clients do not have to pay zzp’ers employee insurance premiums, it may be more attractive to hire a zzp’er than an employee. In addition, as a self-employed professional, you have more tax benefits. This uneven playing field between the self-employed and employees can result in fewer people being hired or employees having less favourable working conditions. Also, as there is no minimum wage for zzp’ers, you may end up earning too little to make ends meet.

The consequences

If the Tax Administration sees malicious intent, your client may receive a fine and will need to pay social security premiums retroactively. You as a zzp’er will need to stop working for them, and will lose your right to tax benefits such as the private business ownership allowance and SME profit exemption.

The DBA Act also applies to intermediaries

Do you use an intermediary to find clients? Then the intermediary must also comply with the DBA Act. An intermediary can work in 2 different ways. There is a model agreement for both: mediation between you and a client (mediation model) or as an intervention (intervention model).

• Mediation (bemiddeling) is when an intermediary links you to an outsourcer. But after this introduction, the outsourcer gives the assignment directly to you. And the contract is between you and the outsourcer. This makes the outsourcer your client. You use the model agreement mediation (modelovereenkomst bemiddeling, in Dutch)
• Intervention (tussenkomst) is when the outsourcer gives the assignment to an intermediary who then finds you to do the assignment. The contract is between you and the intermediary. You send your invoice to the intermediary. This makes the intermediary your client. You use the model agreement intervention (modelovereenkomst tussenkomst, in Dutch).

How to avoid false self-employment

There are several things you can do to emphasise your independence and to ensure that the Tax Administration sees you as a self-employed person:

• Work for several different clients, at least three a year;
• Invoice each assignment separately;
• Invoice your clients directly;
• Document which assignments you confirm and reject;
• Invest in your own work equipment and use it in the assignments you carry out, both at home and on location.

Make sure that the Tax Administration sees you as an entrepreneur for income tax. You might be an entrepreneur one year, and not be one the next. The Tax Administration has devised the OndernemersCheck , an online tool (in Dutch) to help you find out whether you are likely to be assessed an entrepreneur or not. When in doubt, consult with a fiscal service provider, or with the Tax Administration.

When you suspect or know about a situation of false self-employment, contact the Tax Administration.

Model agreement

Another important measure to avoid false self-employment is the use of a model agreement from the Tax Administration. You and your client record your working relationship in such a model agreement. It does mean that you must then work according to what has been agreed and recorded in that document. The model agreements are part of the Deregulation Assessment of Employment Relations Act (deregulering beoordeling arbeidsrelatie, DBA Act, in Dutch). A model agreement can help, especially in situations where it is not immediately clear whether there is salaried employment. The step-by-step plan explains what to do if you want to use a model contract. You can also search for a model agreement. You can adjust a model agreement of the Tax Administration yourself. But your modifications must not conflict with the yellow-marked provisions of the model agreement. You can also draw up your own agreement and have it assessed by the Belastingdienst.

Online tool for clients

The Dutch Ministry of Social Affairs and Employment offers an online tool that entrepreneurs can use to find out if an assignment can be performed by an employee or by a zzp’er. The Webmodule Beoordeling Arbeidsrelatie consists of a number of questions to determine if the assignment calls for hiring an independent agent or not.