Tax Figures
Income Tax Rates
Expats working in Holland may be able to qualify for the ‘30% ruling’. It enables an employer to pay an employee a tax free-allowance of up to 30% of their employment income and they can receive a tax-free reimbursement of the school fees for children attending international schools.
Note that the employee must qualify for this ruling and an application must be made by the employer and employee and the Dutch tax authorities must issue a grant before the ruling is applied. The ruling is only applicable for the first 96 months of their employment in Holland.
- 0 – 19,645: 5.10%
- 19,645 – 33,363: 10.85%
- 33,363 – 56,531: 42%
- 56,531 +: 52%
Time to prepare and Pay Taxes
119 hours
Employers Social Security and statutory contributions
- Disability (WAO) – 4.95%
- Unemployment (WW) – 2.15%
- Health Insurance (Zvw) – 7.50% up to a max of €195.58 per day
- Pension – 2.79%
- Sickness Benefit – 1.59%
- Childcare – 0.50%
Employees Social Security and statutory contributions
31.15% capped at earnings up to €33,363 p/a
Payroll
There are specific rules for payroll and taxation in Netherlands, depending upon the type of business structure being used. Any business with employees must register with the Dutch Tax Authorities, and receive a payroll tax number. The primary concerns for a foreign company that needs to comply with tax laws in Netherlands are: income tax withholding, national insurance withholding, (included in payroll tax), business tax and permanent establishment concerns.
Remote Payroll
A remote payroll in Netherlands is where a foreign company, i.e. a non-resident company, payrolls a resident employee in Netherlands. One option for a non-resident company to payroll its employees (local and foreign) in Netherlands is to use a fully outsourced service like a GEO which will employ and payroll the staff on their behalf.
Local Payroll Administration
In some cases, a company will register their business in Netherlands under one of the forms available, but prefer to have another company administer its payroll. This can be accomplished through a payroll provider. It is important to note that the company, as the Employer of Record, is still fully responsible for compliance with employment, immigration, tax and payroll regulations. But the payroll calculations, payments and filings can all be outsourced to the payroll provider.
Internal Payroll
Larger companies with a commitment to Netherlands may wish to run their own local payroll for all employees, foreign and local. In order to accomplish this, they will have to complete incorporation, register the business and then hire the necessary staff. There will be a need for in country human resources personnel who have the background needed to manage a Netherlands payroll, and can fulfill all tax, withholding, and payroll requirements.
Currency
Euro
