Employee or self-employed contractor?

Hiring a self-employed contractor instead of an employee surely sounds like a win-win situation! But do you know all the fiscal and legal risks and pitfalls?

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Working with self-employed contractors in the Netherlands

If you consider hiring a self-employed contractor (freelancer), it is wise to do your homework first! There are many fiscal and legal pitfalls that employers regularly face. For example, do you work with a model agreement which is approved by the Dutch Tax Office? And do you know exactly the criteria for a self-employed contractor to qualify as self-employed by the Dutch Tax Office instead of an employee?  

 

Is a worker a self-employed contractor or an employee?

With the introduction of the Deregulation of Assessment of Independent Contract Status Act (DBA), it has become even more difficult for employers to work with self-employed contractors (or freelancers). The Deregulation of Assessment of Independent Contract Status Act assesses whether there is an employment contract based on various factors. Some of these factors between employer and employee are:

  • Is there an obligation to work?
  • Is there an authority relationship?
  • Does the self-employed (freelancer) receive salary?
  • Are there other provisions that play a part?

Read all about the assessment criteria authority, labour and wages in our free downloadable information brochure:

Download the DBA information brochure

 

Approved model agreement (by the Dutch Tax Office)

At all cost, you will want to avoid the Dutch Tax Office to inform you that it is not a case of a self-employed contractor, but of salaried employment. Therefore the Dutch Tax Office has drawn up standard model agreements which are free to use. However, these contracts are in Dutch and are not optimized to cover all of your risks as an employer.

AAme works with own contracts which have been approved by the Dutch Tax Office. This assures you of a contract that covers the risks, meets the strict requirements of the Dutch Tax Office and the Deregulation of Assessment of Independent Contract Status Act.

 

Limit your hirer’s liability by utilizing an assurance report (or auditor report)

Do you work with hired personnel, such as posted workers or freelancers / self-employed contractors? Then it is advisable to have an assurance report (or auditor report) drawn up by an accountant / CPA. As a result, you will limit the hirer’s liability. This means you will limit your liability for the payment of taxes and social security contributions. It may come in handy when lending parties do not live up to their obligations!

Read more about the assurance report

Not self-employed but an employee after all

It occurs that after our check we would state that there is a case of an employment contract. If this is the case, we offer – depending on the type of employee – the following payroll solutions:

 

self-employed contractor freelancer expat

 

Working with self-employed contractors without worries!

For many years, we support employers and employees in solutions to work on assignments without worrying about risks and administrative hassle. Due to the constantly changing laws and regulations, many employers are happy with the solutions we offer:

  • AAme is a contract party. The self-employed contractor provides us with the hours worked and the rate. We will invoice the employer and we will pay the self-employed contractor.
  • AAme is an advisory party. We provide support with the administrative hassle, checks, contractmanagement and document management, but we are no contract party.

Please feel free to contact our office to discuss the possibilities and to see which solution fits your needs best.

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