Withholding payroll taxes
Perhaps you are a resident business owner that employs or takes on staff who do not reside in the Netherlands, or a non-resident business owner that employs staff in the Netherlands. In such cases, the following subjects may well be of interest to you:
International issues: payroll taxes
If you carry out an enterprise in the Netherlands or employ people in the Netherlands, you probably have to pay payroll taxes, also when you are established abroad.
What are payroll taxes?
The payroll taxes are composed of the following elements: wage tax; national insurance contributions; employed persons’ insurance scheme contribution and income-dependent Care Insurance Act contribution.
When do you have to withhold payroll taxes?
If an entrepreneur is not established in the Netherlands, you are, in certain situations, liable to withhold payroll taxes and pay them to the Tax and Customs Administration.
Voluntary tax return
If you do not have to withhold wage tax under Dutch law, but your employee has to pay income tax in the Netherlands, you may nevertheless opt for withholding wage tax.
Which payroll taxes do you have to withhold?
If you have to withhold payroll taxes, you usually have to withhold all payroll taxes. However, in some instances, you do not have to withhold wage tax or national insurance contributions.
If you withhold payroll taxes
If you withhold payroll taxes (either voluntarily or as required by law), some administrative obligations apply.
Keeping payroll records
If you proceed to withhold payroll taxes, you must keep payroll records. Payroll records are required to withhold the correct amount of payroll taxes and to submit the correct data to the Tax and Customs Administration.
Calculating payroll taxes
You must calculate the payroll taxes that you must withhold from the wages of your employee. The most important kind of wages are wages in money such as a salary, a holiday allowance and an overtime allowance.
Life-course savings scheme
The life-course savings scheme was introduced on 1 January 2006. This savings scheme enables employees to finance a period of unpaid leave in the future.
Pension schemes as of 1 January 2006
As of 1 January 2006 all pension schemes must be adapted to the tax frameworks introduced by the Amendment to the Tax Treatment of Early Retirement and the Introduction of the Life-Course Savings Scheme Act.
Private use of a car made available by the employer
If you make a car available to your employee, the private use of that car is taxed as wages in kind (ie. wages not earned in money). You must withhold payroll taxes and the income-dependent Care Insurance Act contribution in relation to such use.
The most important rates, amounts and percentages for 2007
Please find below the most important rates and percentages for the year 2007.
The most important rates, amounts and percentages for 2008
Please find below the most important rates and percentages for the year 2008.
The most important rates, amounts and percentages for 2009
Please find below the most important rates and percentages for the year 2009.
The most important rates, amounts and percentages for 2010
Please find below the most important rates and percentages for the year 2010.
The most important rates, amounts and percentages for 2011
Please find below the most important rates and percentages for the year 2011.
Further queries
For further information on payroll taxes, please read the 'Personeel en loon' section on the Internet site (in Dutch).
 Individuals