When must you withhold payroll taxes?

When you are not established in the Netherlands and you employ personnel who live or work in the Netherlands you must, in some situations withhold (some of the) payroll taxes in the Netherlands.

Some payroll taxes are withheld from your employee’s wage, and some you must pay yourself. Which payroll taxes you must withhold and which you must pay depends on several factors:

• You withhold wage tax from the wage if your employee must pay tax on their wage in the Netherlands and if you are the withholding agent. Tax treaties determine whether your employee must pay wage tax in the Netherlands. The Dutch Wages and Salaries Tax Act 1964 (Wet op de loonbelasting 1964) determines whether you are the withholding agent.
• You withhold national insurance contributions from the wage if your employee is covered by the Dutch social security insurance schemes and you are the withholding agent. The European Regulation No. 883/2004, social security agreements, and national legislation determine whether your employee is covered by the Dutch social security insurance schemes. The Dutch Wages and Salaries Tax Act 1964 (Wet op de loonbelasting 1964) determines whether you are the withholding agent.
• As the employer, you pay the contributions for the employed persons’ insurance schemes yourself. Only 1 criterion applies: your employee falls under the social security insurance schemes of the Netherlands. The European Regulation No. 883/2004, social security agreements, and national legislation determine whether your employee is covered by social security in the Netherlands.
• For the Healthcare Insurance Act (Zvw) (Zorgverzekeringswet), the following applies: you pay the employer’s Zvw contribution (werkgeversheffing Zvw) yourself, and you withhold the employee’s Zvw contribution (bijdrage Zvw) from your employee’s wage. Here too, only 1 criterion applies: your employee falls under the social security insurance schemes of the Netherlands. The European Regulation No. 883/2004, social security agreements, and national legislation determine whether your employee is covered by social security in the Netherlands.