Working in the Netherlands. What do I need to know?

The Netherlands is an appealing location for many contractors to work. There are lots of opportunities for expats to work, with a wide range of international and multinational companies. Dutch international companies include ING Group, Shell Group, Unilever, Philips and Heineken, plus plenty of recruitment companies aimed at placing foreign workers in jobs in the Netherlands. However lots needs to be arranged for those who want to work in The Netherlands. Here are the most important thing you need to know.

Dutch Work Permit

Citizens from the European Union (EU), European Economic Area (EEA – EU plus Iceland, Liechtenstein and Norway) or Switzerland do not need residence permits or work permits, except those from newer EU member Croatia, whose citizens need a Dutch work permit for their first year. Some foreign nationals – such as highly skilled workers, Blue Card holders, the self-employed, recently graduated students on an orientation year, or those coming to the Netherlands to join a relative who has permission to work. Everybody else who wants to come and work in the Netherlands will need a separate TWV work permit (tewerkstellingsvergunning) in their name, in addition to a Dutch residence permit. See the types of Dutch residence and work permits below.

Health Insurance in the Netherlands

Expats that are living and working in The Netherlands are usually required to take out basic health insurance to cover the costs of unexpected medical care, such as consulting a General Practitioner (GP), medication and hospital treatment. Basic Dutch health insurance is available for approximately 105 Euros per month.

Taxes

Whether you are a Dutch citizen or an expat, you are required to pay taxes if you earn money while living/working in The Netherlands. The Belastingdienst (Dutch tax office) collects taxes through a variety of streams. If you are employed by a company then your income tax will be withheld from your salary by your employer, this is known as wage tax (which is contained within payroll tax). If you are self-employed in The Netherlands then you must calculate and pay your income tax via the annual tax return.

Living in The Netherlands

The Netherlands is known as the Gateway to Europe as a result of the waterway network, which links Belgium, France and Germany. The Netherlands is a popular location for expats and the majority are able to adjust easily to the Dutch way of life. As one of the world’s most densely populated countries, living in an apartment is commonplace. Expats can either rent or buy apartments and Dutch accommodation in generally of a high standard and most apartments feel spacious with large windows and high ceilings.

Culture and Language

Dutch is the official language of The Netherlands and is spoken by around 90% of the population. Around 350,000 people, or 2.2% of the population speak Frisian as their first language, mainly in the northern province of Friesland, where it is recognised as an official language.  The Netherlands is a democracy with a tolerant, open society. Everyday life is structured down to the smallest detail. Private life and work are carefully planned and nothing is left to the unexpected.

How TCP can help

With all of the above in mind, figuring out all the rules surrounding working in the Netherlands can be a difficult task, however TCP Solutions can help.

We make it easy for contractors working in the Netherlands and advise you on the most suitable solution, whether you’re a Highly Skilled Migrant, a self-employed/freelancer or prefer a local compliant payroll construction.  For employers and agencies we can also help. For over 20 years we have been working with temporary staff and staff on contracts to businesses across Europe, and we will fully indemnify everyone – individuals, agencies, employers. We are G Account Holders, with NEN4400-1 and VCU verification, and we employ over 1,000 contract and temporary staff on behalf of our clients in the Netherlands alone.

TCP not only operates in The Netherlands but also in 10 other European countries. We fully indemnify all parties (client and employee) against any risk or liability that can arise should anything go wrong with the payroll or should the employment not be set up correctly. Would you like to know more? Please contact a member of our sales team on +44 (0) 208 996 0883 or send us a message via our contact page.

Impact of IR35 for Contractors in the UK

Despite opposition from contractors and employers alike, the new updates to IR35 came into effect in April 2017 for contractors working in the public sector.

IR35 affects contractors who do not meet HMRC’s definition of self-employment. The legislation was designed to stop contractors working as ‘disguised employees’, by taxing them at a rate similar to employment. Prior to the IR35 being created, the number of companies working via their own limited companies was rising at a rapid rate. Limited company owners enjoy a number of benefits which are not available to permanent staff. The government believed that many limited company professionals were in fact ‘disguised employees’ who provided services to their clients in the same way as normal employees, and not in the manner of typical ‘self-employed’ people who used their own limited companies. As a result the Intermediaries Legislation was created. If you are selected for a HMRC IR35 compliance check, the wording of your contract and the way you actually carry out the contract will be examined to determine whether you are ‘employed’ or ‘self-employed’ for tax purposes.

Since the IR35 came in to effect in April 2017, contractors suffer the most with an average 13% income drop. There has also been a backlash from contractors in the public sector, many of whom have stopped working, placing projects in jeopardy in the process. There has also been a sharp rise in non-compliance with an increased uptake in non-compliant loan schemes amongst contractors. 

In November 2017, the government used the autumn budget to confirm plans for a consultation on extending the IR35 tax avoidance reforms to the private sector, despite fierce opposition.  The consultation process will last up until summer 2018, confirming suspicions that IR35 in the private sector will not experience changes until 2019 at the earliest. Although not likely to happen soon, contractors in the private sector would be advised to plan as if the public sector rules will apply to them in the near future. 

If you are a contractor and worried about how IR35 will affect you, then TCP Solutions can help you with this. When employed by TCP Solutions, you as the contractor don’t need to take on any responsibilities such as ensuring accounts and tax returns are submitted on time and the correct amount of tax is paid, as this will be done by TCP Solutions. As an employee of TCP you will also receive paid holiday and sick pay, benefits contractors are not entitled to when self-employed.

If you do not comply with the IR35 rules you will be charged a hefty fine. TCP Solutions operates across Europe and fully indemnifies all parties (client and employee) against any risk or liability that can arise should anything go wrong with the payroll or should the employment not be setup correctly.  Would you like to know more? Please contact Ben Paulo (Business Development Executive) on +44 (0) 208 996 0883 or send us a message via our contact page.