Certainly, see: https://payrolus.com/services/employer-of-record-eor/

To employ a person that resides in the Netherlands and to pay its taxes and social security premiums normally you have the option to use your own company but also to use our company as a so-called employer of record. These options also apply if your company is from abroad and has no binding with the Netherlands. For more on these please see our pages on PEO, EOR and tailored solutions.

If you and/or your partner have at least 5% direct or indirect share interest in a company (e.g. a B.V.) and work for that company then the Dutch minimum salary rules (of art. 12a Dutch wage tax act) apply. This stipulates (par. 1) that your salary should in 2024 be at least the salary of the most comparable job outside your company, that of the highest earning employee within your company or € 56,000, whichever is the highest. For comparison, you can for instance look at https://www.intermediair.nl/salariskompas and https://loonwijzer.nl/salaris/salarischeck. If the company is not able to pay you the applicable minimum amount (for instance when it just started or when it makes money but there is no cash anyway), there are possibilities to deviate from this requirement.

The tax rate applied to additional salaries like holiday allowance and bonus (i.e., the so-called marginal tax rate) is higher than the rate applied to the regular salary. This is so because of the following reasons: 1. The wage tax for the regular salary has been calculated taking into consideration also levy deductions, which are discounts on income tax. Everyone in the Netherlands is entitled to such levy deductions (normally general levy deduction and income dependent labour deduction). These levy deductions can only be applied once. So, since these normally already have been applied fully to the regular salary, they cannot also be apply to additional salaries. 2. Income tax rates in the Netherlands increase when taxable income increases. When calculating the tax for the regular salary, the lowest rate is first applied, then next rate et cetera (plus taking into consideration the aforementioned levy deductions). And since the levy deductions decrease when the income increases (e.g. due to extra salaries), the tax rate applied to the additional salary may increase furthermore to correct for the too much applied levy deductions. The tax rate applied hence can even become higher than the highest income tax rate (49.25%).

As natural persons in the Netherlands, we pay personal income tax, for which we normally submit an income tax return after year-end, but in some cases also preliminary during the year. The Dutch state does not want to depend on natural persons filing their income tax returns and perhaps paying tax, so we have wage tax, which is tax to be withheld by employers monthly from the salary and paid directly to the state. This wage tax is credited against the income tax eventually to be paid after submitting the annual income tax return. So effectively the wage tax is a prepayment of income tax collected by the employer. In straightforward situations (e.g. most of our expat clients who only have a job during the whole year without changes in salary) this results in a (near) perfect match between income tax that needs to be paid after submitting the personal income tax return and what was withheld and paid by the employer already, resulting in nothing to be paid or received upon submitting the income tax return. With interim outset or finish of the employment but also if for instance tax deductible items have been claimed in the income tax return (e.g. mortgage interest) normally there is an overpayment of wage tax, which is refunded following the submission of the income tax return.

Holiday allowance should be paid out at least once a year, so, yes, monthly is possible and should be agreed in writing, although normally it is paid out once, in May (or June).

Yes if agreed so in writing (art. 16 par 5 WML) and under certain circumstances even if not explicitly agreed. Without agreement on holiday allowance normally the employee is entitled to holiday allowance regarding the wage amounting to 3 times the minimum wage but not for any exceeding wage (art. 15, par. 1 WML).

Buildup is over wage, defined for this purpose as all monetary income from employment, except over what is outlined in art. 6 WML. That includes gross wages, including overtime, commissions, pay for unregular hours, payout of holiday days but not over bonuses, transition fees (transitievergoeding ex 673 DCC) and the holiday allowance itself.

If the employee enters into a lease agreement him-/herself the Dutch tax authorities normally will not consider the car as a company car but as a private car, which would have the following implications: - The employer can reimburse EUR 0.23 per kilometer tax free for business kilometers (which includes commuter travel), which can be done through the payroll. - The employer can reimburse her for the full amount of the lease expense (including VAT), which would be considered as a net salary and should be grossed-up. Also for this additional salary the 30% rule could be applied (if she would have the 30% ruling). - The tax-free travel allowance would be fully deductible at the level of the employer (and on-charged by us should we be the employer of record). All other car expenses, like fuel, insurance, tax, maintenance etc are private expenses of the employee and cannot be on charged (and are deemed to be included in the 23 cents tax free allowance). Should the employer cover these expenses anyway, that again would constitute a net salary that should be grossed up (or can be covered by the free-budget of the work-related work scheme). For completeness’ sake, some think that if the employee leases her-/himself yet is fully reimbursed (tax free) for the lease expenses by the employer, that the car then has become a company car since the lease then has been effectively paid for by the company and not the employee. So, a de facto approach instead of a de iure approach.

The implications of a company car (lease) give to an employee are as follows: - In some cases more flexibility (e.g. with more employees simultaneously/successively). - The contracting company (lessor) should be able to reclaim the (Dutch) VAT. - If the employee drives more than 500 kilometers with the car annually privately then there will be a fiscal addition (i.e., deemed salary in kind), which normally is calculated as 16% or 22% of the car’s catalogue value depending on the car’s CO2 emission (and also taken care of through the payroll). - For a company car made available to an employee a km administration should be kept (e.g. attached) if the employee would take the position that she does not use the car privately for more than 500 kms annually. - If the employee pays car related expenses (e.g. fuel) from private means then the employee can be reimbursed tax-free through the payroll.

Employees may not work each week the same number of days at the office and even less due to holidays, illness et cetera. In those cases you could opt for the practical 214 days approach. The facility has the advantage that you don’t have to settle for the actual days travelled and worked at home, which saves lots of time tracking and effort and is also more generous fiscally. On a full-time basis the number of working days annually normally is 260. Due to illness, national holidays etc. the number of working days for this matter is assumed to be 214. If at least 128 days in a year the employee travels to a fixed working place, then you can compensate the employee tax-free for 214 days of traveling. If you wish to compensate the employee for working at home tax free as well, let’s say you agree for weekly 3 days traveling to office and two days working at home, then the calculation becomes 3/5 x 214 days compensation for traveling (required actual days of traveling: 3/5 * 128 = 76) and 2/5 x 214 days compensation for working at home (required actual days of working home: 2/5 * 128 = 51). You do have to make sure that the minimum number of travel/homework days are met (here: 76 and 51) and that employer needs to have agreed on the scheme (here 3 days max in office, 2 days max home) with the employee. So, for instance, based on 32.3 km one way gives the following monthly tax-free allowance: For traveling: (3/5 x 214 x 32.3 x 2 x 0.21)/12 = EUR 145.16 For home-work: (2/5 x 214 x 2.15)/12 = EUR 15.34.

To determine the distance, one should (e.g. according to Google Maps) take the most common route, which normally is the shortest route but not necessarily, e.g. if the shortest route for whatever reason is not the fastest or is not logical. The fixed tax-free allowance in 2024 is max 23 cents per km, whereas it does not matter what type of transport is used, so you can walk the whole distance and still obtain 23 cents per km tax free. If you walk, you take the most common walking route, if by car the most common car route etc. Either way, it must concern business kilometers. For example, if someone takes a detour because he or she finds that route more pleasant, then the detour kilometers are not business-related and the shorter route is to be taken as a basis for determining the allowance. Commuting travel is considered as business related, likewise an employee’s visit e.g. to a client or a course. See for more on this (though in Dutch): https://www.rijksoverheid.nl/onderwerpen/inkomstenbelasting/vraag-en-antwoord/wat-is-de-maximale-kilometervergoeding-die-ik-van-mijn-werkgever-kan-ontvangen.

If conditions are met (including a max 30 year repayment scheme and house is used as your own primary residence), then interest paid in relation to a loan (whether or not secured by mortgage) is deductible from your income. Also expenses made to acquire a financing loan are fiscally deductible.

In short, your options as an employer are as follows: A. Indicate that employer wishes to terminate the contract for reason of insufficient functioning. Two things can happen: 1. Employee agrees with the termination and the conditions offered for doing so, including the severance payment, e.g. in the form of paid leave. How much the latter should be is a matter of negotiation. Commonly it is fixed at the amount of transition allowance, which is approximately 1/36th of the annual salary for each year in service. Obviously, the longer the employee is in service and the stronger his/her case (and weaker the employer’s) the more the employee can demand. This is the most common way in the Netherlands to terminate a labor contract. 2. Employee does not agree with termination at all or the conditions offered. For reason of insufficient functioning (but also amongst other things for culpable action or negligence, disturbed employment relationship, frequent absenteeism due to illness or a combination), you should then go to Court to terminate the contract. Here the notice period matters. B. Dismiss instantly, for which you need an urgent reason, for instance work refusal, fraud or mistreatment. No notice period is required. Such dismissal the employee can dispute at the court. If the employer (foresees that it will) agree with the employee then we can help, e.g. with drafting the agreement, which by the way would make the employee eligible for unemployment benefits (ww uitkering). But if the employer (foresees that it will) end up in discussions with the employee and can use some guidance and perhaps even have to go to Court, then we would recommend that the employer seeks for assistance from one of the labor attorneys we work with.

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