HomepageStep-by-step guide for outsourcing work
If you run a business in the Netherlands and intend to outsource work to contractors/subcontractors or self-employed entrepreneurs (zzp'ers), you must contend with various government rules and regulations. You can use this step-by-step guide to quickly determine which obligations you must fulfil. This guide also includes a number of rules that apply specifically to hiring foreign staff.
This step-by-step guide is merely a guideline. You may be subject to other obligations as well or you may have to follow the steps in a different order. Consult the other step-by-step guides on this website before hiring permanent of temporary staff.
Information on the outsourcing of work is also available on the website of the Dutch Labour Standards Association (Stichting Normering Arbeid, SNA). By doing business with an SNA-certified company you run less risk of claims from the Tax and Customs Administration if this company fails to meet its obligations.
Step-by-step guide
1. Verify and record the employees’ identity
You are obliged to verify the identity of all workers on the basis of an original identity document. This also applies to self-employed entrepreneurs or employees of contractors/subcontractors to whom you outsource work.
2. Assess whether a work permit is required
If you outsource work to foreign workers, you have to check whether they need a work permit. The contractor/subcontractor must apply for this permit; in the case of self-employed entrepreneurs, you must apply yourself.
3. Avoid liability for payroll tax
The Tax and Customs Administration may hold you liable for the payroll tax owed by your contractor/subcontractor. One way of preventing that situation is to ask this company to set up a blocked account (G account).
4. Assess whether an employment relationship exists
If you outsource work to a self-employed entrepreneur, you must check whether a (notional) employment relationship exists. In order to be certain on this point, you can ask the self-employed worker to submit a Declaration of Independent Contractor Status (VAR).
5. Verify the E101/A1 statement
In some situations, foreign workers may remain covered by social insurance in another country. In that case you are not required to pay social security contributions in respect of these workers. In order to be certain on this point, you can ask your contractor/subcontractor to submit an E101/A1 statement.
6. Provide healthy and safe working conditions
As an employer, you must provide a healthy and safe workplace for all personnel, including self-employed workers and employees who are working for you via a contractor/subcontractor.
7. Establish working hours and rest times
The Working Hours Act states the number of hours that employees are permitted to work and when they are entitled to breaks. This Act also covers workers that you employ via contractors/subcontractors and, in some cases, to self-employed entrepreneurs to whom you outsource work.
8. Ensure that all workers receive at least the minimum wage
Every worker has the right to the statutory minimum wage plus the standard holiday allowance. If you outsource work to employees of contractors/subcontractors you are also responsible for them receiving at least the statutory minimum wage.
9. Pay or deduct turnover tax (VAT)
The contractor/subcontractor or self-employed entrepreneur to whom you outsource work will charge VAT on that work. You can deduct this VAT as input tax. In some sectors, the subcontractor is obliged to reverse charge VAT to you. This also applies if you outsource work to a foreign entrepreneur.
