 |
|
| CURRENT SECTION :: Overseas Guides | UK's most visited IT Contractor Site - 250k unique visitors March 2008 |
|
 |
Profile written by Matt Walters of Capital Consulting (October 2008). I. Registration Any individual taking a contract in the Netherlands must be employed by a Dutch payroll provider. Your employer (this provider) must announce your arrival before you start work in the Netherlands, and indeed before you arrive in the country, or run the risk of exposure to penalties for late registration. This is done by your employer by means of an EDM form sent to the Dutch tax authorities. This rule is due to change at the beginning of 2009, and this requirement is expected to be relaxed. With this registration done, there is a choice to be made based on your contract duration and intentions: between a SoFi number and a BSN number. These numbers fulfil the same function (in many ways they can be considered equivalent to a UK National Insurance number), but differ in the implications that they entail. i. SoFi number The SoFi number is perhaps the better-known of these two, but there has been a change in the system recently that modifies this definition somewhat. The SoFi number now covers contractors who come to the Netherlands with the intention of remaining there for under 3 months, thereby not gaining Dutch tax residency. You can obtain a SoFi number directly from the nearest tax office (belastingkantoor) by showing your passport and giving a home country address. ii. BSN number The BSN number is a relatively new addition, and is intended for contractors who intend to gain Dutch tax residency by remaining in country for more than 3 months. To obtain a BSN number, you must register your residence at your local municipality (town hall, aka GBA). N.B.: Once registered with your town hall, you will remain taxable in the Netherlands until you deregister, so don’t forget to do so when you leave! iii. What if I change my mind? No problem: you may go to your town hall with your previously-obtained SoFi number at any time, and they will register you as a resident. II. Taxation in the Netherlands The Dutch tax year is the calendar year, and tax returns must be filed by April 1st of the following year. Tax rates are banded between 33.65% and 52% dependant on income, but this is tempered by the 30% ruling. Dutch tax allowances: i. The 30% ruling The 30 % ruling is an allowance made by the Dutch tax authorities for skilled workers coming to work in the Netherlands which allows you to take 30% of your gross salary tax free. This is intended to cover your living costs (including accommodation) while in the Netherlands. In order to obtain the 30% ruling, you must have the relevant experience in your field, and be earning over the minimum amount (EUR 45’000 p.a. for 2008). A higher education qualification or professional certificates will also help your eligibility. You must also have a SoFi or BSN number. The application for the 30% ruling should be made by your employer as soon as you start your contract. The 30% ruling must be reapplied for with each new employer, and, excluding periods of employment outside of the Netherlands, will last a maximum of 10 years. ii. Mortgage tax relief Any Dutch tax resident may apply for mortgage tax relief on their principal residence, be it within the Netherlands or abroad. It is worth considering, however, that as a tax resident you will also be liable for tax on your fortune and worldwide income. iii. Tax rebate An individual having worked less than 12 months of any tax year in the Netherlands may apply for a tax rebate on their tax return. iv. Health insurance As from January 2006, it has become a legal obligation for each employee to purchase Dutch private healthcare, although this is then reimbursed tax-free by the employer. Having private healthcare elsewhere makes no difference to this requirement. III. Social Security Social security must be paid on your salary in the Netherlands unless your EU-based employer can detach you from another EU country by means of an E101 certificate. Care must taken here, and it is worth taking advice, as detachment by means of an E101 may not be the best solution in all cases due to either a) the duration of your intended stay in the country, b) the level of cover provided, or c) the cost of said contributions. It is also worth noting that, under the EU social charter, social security contributions made within an EU country will count towards your time stamp for the UK. IV. Work permits Citizens of EU countries, with the exceptions of Romania and Bulgaria, do not need a work permit to take up employment in the Netherlands. This also goes for citizens of Switzerland, Liechtenstein, Iceland and Norway. Citizens of these countries need only register with the municipality (GBA) upon arrival. Citizens of all other countries must go through a full registration and work permit process. A work permit can only be obtained if no suitable candidate can be found in the Netherlands or another Member State of the EU (except Bulgaria). Dependant on your personal circumstances, income and where you are contracting, you may be liable for additional tax in other countries where you are tax-resident (your home country, for example). Before taking any contract overseas, you should always seek professional advice from advisors with experience in the field of international and cross-border taxation. Capital Consulting is an international payroll and contract-management company providing tailor-made tax planning services to contractors working overseas. For more detailed information on your personal situation, please contact Capital on +41 32 732 97 00. Previous Page
|
|
 |
||||||||||||||||||||
| All content © Contractor UK Limited | [Register for News Letter] | [Privacy Statement] | [Terms of Use] | [Top of Page] |