Own agreements

Employment

Verloning.nl takes care of all the paperwork for contractors, but is not involved in the conditions that the contractor agrees with the client. The registered person does, however, appear on the payroll of Verloning.nl via the fictitious employment scheme, whereby the tax and healthcare insurance contributions due are withheld via the withholding tax.

Payment of taxes

The so-called fictitious employment relationship applies to the payroll tax, the Healthcare Insurance Act (ZVW), and the employee insurance schemes; even if there is no real employment contract (between the employee and employer), a designated withholding agent may withhold payroll taxes (the payroll tax and national insurance contributions) and pay the employee insurance contributions along with the healthcare insurance contributions. In such situations, the employment relationship closely resembles an employer/employee relationship, but not all the characteristics of an employment contract - such as salary, authority, and personal nature - are met.

Fictitious employment

1 Decree of 24 December 1986, laying down an Order in Council as referred to in section 5 of the Disability Insurance Act, section 5 of the Sickness Insurance Act and section 5 of the Unemployment Insurance Act, Netherlands Official Gazette 1986, 655, as last amended on 14 June 2017, Netherlands Official Gazette 2017, 270.

1

The opting-in scheme

Article 4 of the Income Tax Act (IT) and Articles 2g and 3 of the Income Tax (Implementation) Decree of 1965 (Impl. Dec). Under this scheme, a taxpayer can report to the tax authorities together with the withholding agent, and thus have tax deducted voluntarily. The opting-in scheme applies only to income tax and national insurance contributions.

2

The equivalent scheme

Article 7 of the IT Act and Articles 2c and 3 of the Impl. dec. A person is in fictitious employment if, other than as an entrepreneur, he or she performs personal work at least two days a week for a gross income of at least 2/5 of the statutory minimum wage (Article 4(e) of the IT Act and 2c of the Impl. Dec.). This scheme also applies to employee insurance under Article 5 of the Sickness Benefits Act, Article 5 of the Unemployment Insurance Act, Article 5 of the WAO (Invalidity Insurance Act), and Article 8 of the WIA (Labour Capacity Act), together with the decree on the "Designation of Cases" regarded as employment. Article 6 of this decree states that any person who has undertaken to pay wages is considered an employer.

Fictitious employment

The contractor chooses to work outside of employment (i.e. not as an employee) for a client, and to enter into a fictitious employment relationship with Verloning.nl, so that the invoicing of fees goes through Verloning.nl.

In practice

The contractor chooses to work outside of employment (i.e. not as an employee) for a client, and to enter into a fictitious employment relationship with Verloning.nl, so that the invoicing of fees goes through Verloning.nl.

The contractor and the client agree that the fee under the assignment agreement will be invoiced by Verloning.nl to the client. Verloning.nl will then, at the contractor's request, consider the payments received (after employer contributions) as wages within the meaning of the Wages and Salaries Tax Act of 1964. Verloning.nl will calculate, withhold, and pay the payroll tax, and pay out the remaining net amount to the contractor.

Contact

Are you interested?

If you would like to discuss your specific situation, please feel free to contact us. We will help you to become your own boss in a way that suits you.