The importance of compliance in the Netherlands

Recruitment companies
As Sales Manager at AAme Accountants & Tax Advisors I have a lot of contact with International Recruitment companies as well as Multinational Companies operating in The Netherlands. It still surprises me after many years in the industry that organisations are prepared to take the risk and partner with non compliant management companies. Tax Chain Liability is very prominent in The Netherlands and companies are audited regularly by the Tax authorities to check that their work force are set up compliantly. Many foreign (and also local) recruitment companies forget that they are part of the contractual chain and that they may be liable for unpaid taxes and fines if individuals are caught!

| Do not risk more than you can afford to lose!

 

Daily, I try to educate companies that are new to operating in The Netherlands and the importance of compliance. Don’t forget that it is not only your organisation that is at risk but also your customers where you are placing your candidates.   Here is a common scenario – Contractor is operating with a foreign entity not registered in The Netherlands whilst working onsite in The Netherlands and not paying local taxes. What is wrong here? Plenty……..

Risks
Have you asked yourself the following questions?

  • Have you considered DBA Legislation?;
  • Are they truly Self Employed?
  • If so, are they engaged under an Approved Model Contract?

The 183 Day Ruling is not applicable in the scenario whereby a Recruitment Company is involved in the contractual chain. Tax should be paid in country from day one. It’s almost a monthly occurence that I hear of Payroll Companies going bankrupt. This is mainly down to compliance issues. Think how this could affect your business, candidates not getting paid and as a result relationships tarnished and lost. I cannot emphasis enough why it is important to partner with well established NEN- 4400 Certified Companies.

| Risk comes from not knowing what you are doing

 

There is no doubt that The Netherlands is a complex country with respect to legislation. In January 2020, there will be changes to the current Dutch Labour and Employment Laws (Balanced Labour Market Act) which will have an impact on many contracts of employment. How is your company preparing for this?

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