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Netherlands: New concept of “economic employer” in respect of salary splits?

Sander Michael 05 Mar 2020

A salary split may be triggered if an employee is posted to a foreign group company and the foreign group company qualifies as “economic employer”.

A salary split may be triggered if an employee is posted to a foreign group company and the foreign group company qualifies as “economic employer”. According to the Supreme Court and a Decree of the State Secretary, this is the case if:

• There is a relationship of authority between the employee and the foreign group company, and
• The duties of the employee are an integral part of the business activities of the foreign group company, and
• The formal employer charges the salary costs in an individualised manner to the foreign group company

However, a Dutch lower court has now ruled that an individualised recharge is not required and that it is generally sufficient if the salary costs are borne by the foreign group company.

Discover more: Netherlands: New concept of “economic employer” in respect of salary splits?

Article tags

Compensation Tax | Netherlands