Reply to: Contract in Netherlands - General Advice and payroll

[Sue B]

It is not incorrect at all.

I haven't not suggested for one minute that the worker cannot use their LTD I have recommended they check its residency status.

For the record, a Limited company is not domiciled, it is resident. Therefore the residency tests apply.

Under the Residency Articles, The OECD model defines a Permanent Establishment to include a place of management.

Therefore a UK LTD whose working director is based in NL and whose client is in NL has a reporting liability in NL as well as the UK. It should be considered that the Dutch will have first taxation rights unless you have written confirmation from the Dutch Tax Office to the contrary.

The double taxation treaty allows for the relief of Corporation taxes paid overseas.

In addition I have actually said in my original response that the individual is taxable in NL from day one because you are absolutely right on that one.

Trust this clarifies.

[petergriffin]

That information is completely incorrect!

Blijf rustig, ajb!

[norrahe]

a) Does most people go for payroll option compared to having there own limited company in Netherlands? Can I not use my UK limited company to get paid for my contract in Netherlands?

You may use your UK Ltd in Holland, the question is whether you should You have to work out if it is worthwhile. Under the EU double taxation treaty rules, if you have a place of management in the Netherlands then you have a permanent establishment in the Netherlands. A place of management is normally triggered for a UK Ltd because its only working Director is overseas.

Therefore the UK LTD has a requirement to register locally and deal with all appropriate reporting and local accounting and you will need a Dutch Accountant in the same way as you use a UK Accountant for your LTD.

In addition, if you are working for a Dutch client who has a permanent establishment there, then you personally are taxable from day one too. Therefore is doesn't seem worthwhile going through the process of registering, financially, you could be worse off than PAYE in country.


b) I am ready to go with the payroll but the agency's only option is easystaff.

I assume the agency has audited its PSL and is confident that they payroll company is registered in Holland and is declaring all taxes/NI in accordance with local and UK legislations. Please bear in mind that taxation is a personal responsibility and if something does go wrong the liability will be yours.


c) Agency is saying that I will get paid 2.5 Euro per hour less than what we agreed to - just because I am going via payroll company. I am yet to receive the breakdown from the payroll company but I understand they will be charging extras on the top of 2.5 Euro per hour. is that how it works in Netherlands?. I would not have thought so. What is a good descent reasonable %age that a good payroll company charges? Any ideas?

All payroll companies will charge a fee to process your payroll, this is met by either the contractor or by the agency. We charge a flat rate fee. Others prefer to charge %'s.

Also, Has anyone have any past experience or knowledge about this payroll company.

No sorry I am not familiar with their services and cannot comment.

PAYE in Holland would normally net you between 60-70% of gross depending on your contract and personal circumstances.

HTH

That information is completely incorrect! You can be seconded to another EU country but as long as your LTD is domiciled in it's country of origin your company will not be eligible for taxes in the country that you are working in. If your company decides to base itself in the country they are working then that company becomes eligible for taxes in the country where the director is working.

You yourself as an individual will need to pay taxes in NL, the company will not. These can then be reimbursed under the dual tax ruling.

The advice given that you should not register for taxes in NL will result in you getting fined by the NL Belastingdienst, all I can say is please, please, please Consult someone who knows what they are taking about.

[Sue B]

a) Does most people go for payroll option compared to having there own limited company in Netherlands? Can I not use my UK limited company to get paid for my contract in Netherlands?

You may use your UK Ltd in Holland, the question is whether you should You have to work out if it is worthwhile. Under the EU double taxation treaty rules, if you have a place of management in the Netherlands then you have a permanent establishment in the Netherlands. A place of management is normally triggered for a UK Ltd because its only working Director is overseas.

Therefore the UK LTD has a requirement to register locally and deal with all appropriate reporting and local accounting and you will need a Dutch Accountant in the same way as you use a UK Accountant for your LTD.

In addition, if you are working for a Dutch client who has a permanent establishment there, then you personally are taxable from day one too. Therefore is doesn't seem worthwhile going through the process of registering, financially, you could be worse off than PAYE in country.


b) I am ready to go with the payroll but the agency's only option is easystaff.

I assume the agency has audited its PSL and is confident that they payroll company is registered in Holland and is declaring all taxes/NI in accordance with local and UK legislations. Please bear in mind that taxation is a personal responsibility and if something does go wrong the liability will be yours.


c) Agency is saying that I will get paid 2.5 Euro per hour less than what we agreed to - just because I am going via payroll company. I am yet to receive the breakdown from the payroll company but I understand they will be charging extras on the top of 2.5 Euro per hour. is that how it works in Netherlands?. I would not have thought so. What is a good descent reasonable %age that a good payroll company charges? Any ideas?

All payroll companies will charge a fee to process your payroll, this is met by either the contractor or by the agency. We charge a flat rate fee. Others prefer to charge %'s.

Also, Has anyone have any past experience or knowledge about this payroll company.

No sorry I am not familiar with their services and cannot comment.

PAYE in Holland would normally net you between 60-70% of gross depending on your contract and personal circumstances.

HTH

[Runs With Scissors]

What's the look for?

Read the quoted bit in my post.....

It might just be me being a bit thick though...

[cojak]

May I remind posters that this is Business / Contracts, not General.

If you want to discuss the sensibilities of the Dutch further, go there.

[Eirikur]

Like I said .... Love Brits,

They do, depending on the skin colour and except those on stag parties in Amsterdam

[Jubber]

Huh? Biggest bunch of rude, unfriendly, intolerant racist bastards in the world. Have worked there for many years so I know what I'm talking about

Like I said .... Love Brits, hate Germans

[SueEllen]

eh?

What's the look for?

It's like you or me saying "Native British English speaker required" to avoid employing anyone from the EU, Commonwealth or States.

The recruiting manager is being racist but disguising it badly - from my personal experience both Dutch, Flemish and Afrikaans speakers have no difficulty understanding what each other say.

[Runs With Scissors]

If the Advert says "must speak Dutch" or "native Dutch speaker required" then the project manager is most likely Dutch in the Netherlands

If the Advert says "must speak Dutch" or "native Dutch speaker required" then the project manager is most likely Flemish in the Belgium and won't even accept the Dutch from the Netherlands

eh?

[Brussels Slumdog]

Nationality of Project Manager

Which is why I've seen an increase in the last couple of years in "must speak Dutch" or "native Dutch speaker required" at the end of a gig description which is in English. If you require a Dutch speaker then advertise in Dutch, not English and put the language requirement FIRST, not the LAST sentence.

If the Advert says "must speak Dutch" or "native Dutch speaker required" then the project manager is most likely Dutch in the Netherlands

If the Advert says "must speak Dutch" or "native Dutch speaker required" then the project manager is most likely Flemish in the Belgium and won't even accept the Dutch from the Netherlands

I have only worked once in the Netherlands where the project manager was Dutch on the other occasions they were foreign

Agencies will insist that you use a dutch payroll company due to dutch chain law which means that if the clientco is audited then they will be responsible for the tax and then will try and retrieve the tax from your agent . Dutch nationals have what is called a VAR which is statement proving that they are resonsible for paying their tax.
The 30% ruling is now more strict as you have to live more than 150 KM from the Dutch border which means I no longer qualify.
You are also required to take out private medical insurance if you are working in the Netherlands.This is about 100 euros but the other social costs are small change compared to Belgium

[Bellona]

Which is why I've seen an increase in the last couple of years in "must speak Dutch" or "native Dutch speaker required" at the end of a gig description which is in English. If you require a Dutch speaker then advertise in Dutch, not English and put the language requirement FIRST, not the LAST sentence.

Completely agree.
Goes for UK recruiters as well though. Im on the bench at the moment and have had initial excitement replaced with an exasperated "oh Bo*!ocks" when I reach the last line of a spec and it says "must be fluent in French/German/Dutch" etc

[norrahe]

Would they employ a Dutch National over an equivalent (in all terms including cost) applicant that was a non national ? Definitely.

Which is why I've seen an increase in the last couple of years in "must speak Dutch" or "native Dutch speaker required" at the end of a gig description which is in English. If you require a Dutch speaker then advertise in Dutch, not English and put the language requirement FIRST, not the LAST sentence.

[norrahe]

Huh? Biggest bunch of rude, unfriendly, intolerant racist bastards in the world. Have worked there for many years so I know what I'm talking about

I live there and find the xenophobia amusing, but once you get to know people they're not a bad lot.

[Bellona]

Huh? Biggest bunch of rude, unfriendly, intolerant racist bastards in the world. Have worked there for many years so I know what I'm talking about

I have lived and worked in Holland on and off and I've found the Dutch to be very open-minded people : open to people of all shapes,sizes,colours,creeds, sexual orientation.

Would they employ a Dutch National over an equivalent (in all terms including cost) applicant that was a non national ? Probably. Don't most countries ? Probably.

All countries have small groups of extremists, be it about religion, race, or sexual orientation. I cannot fathom how people can generalize an entire region or country.You can't say all Dutch are racist just because you had a few(or many) bad experiences.

There has been an increase in intolerance since 9/11, in respect of muslims in Holland, as there has been in a lot of western countries, but in terms of "statistics", a number of polls all include Hong Kong, Bangladesh, Jordan and India as the most racially intolerant countries in the world.

Go figure