Netherlands Payroll Compliance Map

Netherlands Payroll Compliance Map

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Email: ams4ww@evershinecpa.com
The Engaging Manager from Headquarter
Ms. Anna Wang, Speak English and Chinese.
skype: burlinna

WWT – Netherlands Payroll Income Tax Deduction

WWT-NL-01 WWT Tax Entity

Question from client:
Is the Netherlands salary income tax levied in national or local? Or both national and local?
Are the national and local personal income tax that levied separately? Or levied together?
What is the standard withholding tax rate?

Answer from Evershine RD:

Wage tax is levied at national level in Netherlands.

Table 1: Wage tax/National insurance contributions

Grade Annual wages (Euro) Wage tax and National insurance contributions Wage tax rate only

(Grade 1b and 2 is fully composed of wages tax)
1. Younger than state pension age 2. State pension age and older,

born in 1946 or later

  
1a 0 35,472 37.07% 19.17% 9.42%
1b 35,473 69,398 37.07% 37.07% 37.07%
2 69,399 or more 49.50% 49.50% 49.50%
Grade Annual wages (Euro) Wage tax and National insurance contributions Wage tax rate only (Grade 1b and 2 is fully composed of wages tax)
3. State pension age and older,
born in 1946 or earlier		  
1a 0 36,409 19.17% 9.42%
1b 36,410 69,398 37.07% 37.07%
2 69,399 or more 49.50% 49.50%

With certain forms of wages, you do not withhold wage tax/ national insurance contributions from the employee’s wages, as you bear the expense. This is what are referred to as the Final Levy in the Table 2a/2b.

WWT-NL-02 Registration

Question from client:
The Netherlands salary income tax collection is under the jurisdiction of which government unit?
The registration of the Netherlands salary income tax collection status, that is, the application procedure for the employer withholding certificate number, paper certificate number application, or online account application? Website? Employer withholding certificate?
What is the advance certificate number of the number? Do you need to use the industrial and commercial certificate e-card to apply?

Answer from Evershine RD:

Employers are required to register with the Caribbean Netherlands Tax Administration.

Register as an employer no later than the day on which the 1st employee start working.

After registering as an employer, you will receive a payroll tax number and a declaration letter within 1 week.

The declaration letter will state when you must file a declaration. Usually, it will be received every year in November.

You will also receive a letter stating which sector your company is assigned within 3 weeks.

Also, a letter with the percentage for the differentiated Whk premium will be received within 4 weeks. This is usually receiving each year in December.

If you are local employer, you can download the form at the below website.

https://www.belastingdienst.nl/wps/wcm/connect/bldcontentnl/themaoverstijgend/programmas_en_formulieren/melding_loonheffingen_aanmelding_werkgever

If your company is based abroad, you can download the form at the below website.

https://www.belastingdienst.nl/wps/wcm/connect/bldcontentnl/themaoverstijgend/programmas_en_formulieren/aanmelding-onderneming-buitenland

WWT-NL-03 WWT Order (OD)

Question from client:
What is the order of Netherlands salary income tax withholding declaration (information flow determines tax base) and payment (fund flow)?
Pay first and then declare?
Report first and then pays?
At the same time as the declaration and payment?

Answer from Evershine RD:

Deposit First (DF): Make monthly payments then file the required forms.

WWT-NL-04 Mechanism of Filing (MOF)

Question from client:
Netherlands salary income tax withholding declaration (information flow determines the tax base)
What is the method of account return?
Reporting cycle: every month? Every bimonthly? Every season? every half year? Per year?
Electronic filing? Manual filing? Electronic filing and manual filing coexist?
If electronic filing is possible: Website URL?

Answer from Evershine RD:

Payroll taxes must be filed online, either through the government’s website (My Tax and Customs Administration (Mijn Belastingdienst Zakelijk), abbreviated as MRD-Z portal) for up to 10 workers or through another digital software system.
You must submit a wage declaration every month or every 4 weeks.
Employers must issue an annual income statement to employees following the conclusion of the calendar year.
Employers report employee withholding taxes through a return at the end of the year.

WWT-NL-05 Mechanism of Payment (MOP)

Question from client:
What is the funding method for the Netherlands salary income tax withholding payment (funding flow)?
Payment cycle: M per month? B every bimonthly? Q every season? H every six months? A every year?
Automatically authorize deduction of ACH (that is, take the initiative of the recipient)?
Electronic remittance to EFT (that is, the payer takes the initiative)?
Bank counter payment OCT?
Or the above methods coexist?

Answer from Evershine RD:

Returns and payments can be made online through the MijnCN portal.
Always state the payment reference listed in the ‘Payroll tax return letter’ when you make your payments.
The timeliness of payments is determined on the basis of the time at which the payment is transferred to the Tax and Customs Administration’s account.
When you use internet banking to make payments or payment orders are automatically generated by your accounting software then you must make sure that you transfer the amounts to the correct account number and cite the correct payment reference.

BNF – Deduction of Employee Social Welfare

BNF-NL-01 BNF Entity

Question from client:
Netherlands’s social insurance, medical insurance, pensions and other employee social welfare levy, is it national? Is it local? Or is there a national plus local? If there is a national and local, are they levied separately? or levied together? What is the withholding tax rate?

Answer from Evershine RD:

The Netherlands imposes the following social taxes:

Table 9: Employee insurance contributions

Contributions Employer Rate
General Unemployment Fund (AWF) low contribution 2.70%
General Unemployment Fund (AWF) high contribution 7.70%
Differentiated contributions under the Return-to-Work Fund (Whk) Variable, upon employer decision
Differentiated Aof premium high 7.05%
Differentiated Aof premium low 5.49%

 

Table 10: Sectoral contributions for the differentiated premium – Return to Work Fund (Whk)

The rate depends on unemployment risk level.

There are 69 sector/ premium group.

Table 11: Wage period amounts, maximum income assessable for social security and maximum contribution wage

Wage period amounts (Euro) Day Week 4 weeks Month Quarter Year
Maximum income assessable for employed persons’ insurance contributions 229.63 1,148.19 4,592.76 4,975.50 14,926.50 59,706.00
Maximum income assessable for Care Insurance Act contributions 229.63 1,148.19 4,592.76 4,975.50 14,926.50 59,706.00

Table 12: Other amounts

Standard amount for Amount (Euro) Percentage
Healthcare Insurance Act (Zvw)
1. employer’s levy Zvw 6.90%
2. contribution Zvw 5.65%
3. seafarers (including share fishermen) 0.00%
Uniform childcare surcharge on Aof premium 0.50%
Payroll tax income limit for 30% facility
*Wage of employee with specific expertise wage of 37,296
*Employee with specific expertise under the age of 30 28,350

BNF-NL-02 Registration

Question from client:
Social Security Certificate Number? What is the name of the government agency in charge of social insurance?
Medical insurance certificate number? What is the name of the government agency in charge of medical insurance?
Pension certificate number? The name of the government agency in charge of pensions?
How to apply for the social welfare certificate number for employees in the country? Paper certificate number application? Or an online account application? Website? Need to use the industrial and commercial certificate electronic card to apply?
Are the above three certificate numbers unified or separate?

Answer from Evershine RD:

Employers are required to register with the Caribbean Netherlands Tax Administration.
As social contributions are collected at the same time and in the same manner as income taxes withheld at source by employers, the protocol for registration for social taxes is the same as the protocol for registration for income taxes.

BNF-NL-03 BNF Order (OD)

Question from client:
What is the order of the withholding declaration of social welfare for Netherlands employees (information flow determines the tax base) and payment (fund flow)?
Pay first and then declare? Report first and then pays?
At the same time as the declaration and payment?

Answer from Evershine RD:

Same Period: Report and pay at the same time.

BNF-NL-04 Mechanism of Filing (MOF)

Question from client:
What is the method of reporting for withholding of social benefits for Netherlands employees (information flow determines the tax base)?
Reporting cycle: every month? Every bimonthly? Every season? every half year? Per year?
Electronic filing? Manual filing? Electronic filing and manual filing coexist? If electronic filing is possible: Web site URL?

Answer from Evershine RD: 

The Caribbean Netherlands Tax Administration assigns filing frequencies, which can be monthly, quarterly, twice a year, or annually.
Payroll taxes must be filed online, either through the government’s website for up to 10 workers or through another digital software system.
Employers must issue an annual income statement to employees following the conclusion of the calendar year.
Employers report employee withholding taxes through a return at the end of the year.

WWT-NL-05 Mechanism of Payment (MOP)

Question from client:
What is the funding method for Netherlands employee social welfare withholding contributions (funds flow)?
Payment cycle: M per month? B every bimonthly? Q every season? H every six months? A every year?
Automatically authorize deduction of ACH (that is, take the initiative of the recipient)?
Electronic remittance to EFT (that is, the payer takes the initiative)?
Bank counter payment OCT?
Or do the above methods coexist?

Answer from Evershine RD:

Always state the payment reference listed in the ‘Payroll tax return letter’ when you make your payments.
The timeliness of payments is determined on the basis of the time at which the payment is transferred to the Tax and Customs Administration’s account.
When you use internet banking to make payments or payment orders are automatically generated by your accounting software then you must make sure that you transfer the amounts to the correct account number and cite the correct payment reference.

Please be aware of below Warning:
The above contents are digested by Evershine R&D  and Education Center in December 2022.
Regulations might be changed as time goes forward and different scenarios will adopt different options.
Before choosing options, please contact us or consult with your trusted professionals in this area.

Contact Us

Amsterdam Evershine BPO Service Limited Corp.
Email: ams4ww@evershinecpa.com
The Engaging Manager from Headquarter
Ms. Anna Wang, Speak English and Chinese.
skype: burlinna

or
For investment structure relevant to multi-national tax planning and Financial & Legal Due Diligence for M&A (Merge and Acquisition), send an email to HQ4ams@evershinecpa.com
Dale Chen, Principal Partner/CPA in Taiwan+China+UK will be accountable for your case.
LinkedIn address:Dale Chen

Additional Information

Evershine CPAs Firm Headquarter
6th Floor 378 Chang Chun Rd., Taipei City, Taiwan ROC
Partner Kerry Chen,  USA Graduate School and a well-English speaker
Tel No.: +886-2-27170515 ext. 105
Mobile: +886-939357000
Email: kerrychen@evershinecpa.com
Skype: oklahomekerry

Evershine has 100% affiliates in the following cities:
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Evershine CPAs Firm is a LEA member headquartered in Chicago, USA, it has 600 member offices worldwide and employs approximately 28,000 people.
Besides, Evershine is Taiwan local Partner of ADP Streamline ®.
(version: 2024/07)

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