Distinction between salaried employees and self‑employed freelancers
The government wants false self-employment prevent. An employee in paid employment pays contributions for social security, for example WW, ZW and pension accrual. A self-employed person (zzp’er) is solely responsible for themselves. When a larger group of workers does not participate in the social security system, it can become more difficult for the government to support vulnerable workers.
It also creates unfair competition for employers who do have permanent employees.
Of wet DBA (Deregulation Assessment of Employment Relationships
Until 2016 self-employed persons (zzp’ers) could make use of a Declaration of Employment Relationship (VAR). As a replacement, that year the Deregulation of the Assessment of Employment Relationships Act (DBA) was introduced. There is a case of sham self-employment when a person works as a self-employed person (zzp’er), but is treated as an employee in paid employment. This occurs, for example, when a self-employed person works for only one client, does not bear entrepreneurial risks, or does not make independent choices when carrying out his or her work. Under the law both the employer and the self-employed person are ultimately responsible for the tax consequences of their employment relationship. In practice the law proved not to be a well-functioning alternative to the VAR. At the moment the Tax and Customs Administration supervision , but temporarily no fines will be imposed or payroll taxes will be collected, unless there is deliberate misuse.
1 januari 2025
Despite the fall of the cabinet, the Dutch Tax and Customs Administration has announced that, from 1 januari 2025, it will more strictly enforce against bogus self-employment. This means that when you, as a client, enter into an assignment with a self-employed contractor (zzp’er) for the duration of a year, you must already take this law into account.
Moreover, monitoring bogus self-employment also proves in practice to be a difficult task for the Tax Administration. From investigation by the Court of Audit also the Tax Authority hired self-employed contractors for certain work while that actually was not allowed, says the Court of Audit. “The Tax Authority has namelyas an employer also has difficulty correctly applying the DBA Act. For example, the Ministry of Finance hires workers through an intermediary, some of whom, on the basis of an internal assessment framework, can in principle be classified as pseudo-self-employed.”
What should you pay attention to?
The Tax and Customs Administration ultimately wants to create a workable relationship between the client and the self-employed person (zzp’er). These are the main criteria that must be taken into account:
· Is there a relationship of authority?
· Does the work form a core task within the organization (embedding)?
· Is there a case of independent entrepreneurship within the employment relationship?
The concept embedding is now being added to the law. This concerns work that others in paid employment also perform: taking part in shifts and being present at clients' premises. The above criteria will be further elaborated in consultation with social partners and stakeholders.
Although the cabinet wants to create a more level playing field between self-employed people and employees, it is important that the new rules are not too rigid, so that freelancers are not disadvantaged.
Want to know more, questions?
Circle8 closely follows the news regarding the WDBA. and shares any developments and noteworthy information directly via our media channels. Should you in the meantime have (specific) questions about the WDBA, then contact Arno Pronk .
