The Health Care Insurance Act Contributions ("Zvw") in the Netherlands

The Dutch Health Care Insurance Act (ZVW) is an obligatory insurance against specific financial implications of care in case of illness.

The funding of this insurance is arranged for by a nominal premium payable by the insured and the income-dependent Health Care Insurance contribution due by qualifying employers or self-employed persons.  

Every Dutch resident (subject to the levy of national social insurance premiums) must take out medical insurance at a private insurance company. The premium depends on the coverage set by the insurance and starts at about € 100 per month and is as high as a couple of hundred euros a month. Under certain conditions, and upon application, an income-dependent allowance is available for people earning a low income (the cost of care allowance, or 'zorgtoeslag').

Furthermore, every employer is obliged to pay the income-dependent Health Care Insurance contribution, which amounts to 6,68% (2021) of income from the current employment of its employees up to the maximum premium wage per employee. The same applies, inter-alia, to particular income categories from prior work and certain government benefits and allowances. This premium must be reported by the employer and paid to the tax office through the periodic (usually monthly) wage tax return.    

The income-dependent premium is an expense for the employer and is not considered taxable wages to the employee. However, for particular income categories, the withholding agent must withhold a 5.43% (2023) contribution from the income. This relates in particular to:

• Wages from previous employment of (former) employees and benefit claimants at the state pension age.
  Certain statutory pensions.
• Annuities, benefits to resistance fighters and war victims, and benefits from occupational pension funds.
• Periodical benefits to replace lost or foregone wages: standing rights benefits.
• (Pre) pension and RVU benefits that qualify as wages from past work, such as FLO benefits.
• As of the 25th month that you pay it.
• Periodic benefits in connection with disability, illness, or an accident that is not included in the collective labor agreement or the employment contract.
• Annuity payments to minors and adults. And payments from an annuity savings account or an annuity investment account.
• Income from current employment of pseudo employees (opting-in) and directors/substantial shareholders ('DGA’s') not covered by employee insurance.

The 5.43% contribution must be withheld from the net salary of the employee (up to the maximum premium wage), reported by the employer, and paid to the tax office through the periodic (usually monthly) wage tax return. 

For self-employed persons, a 5.43% contribution will be levied on the income on which no income-dependent health care premium has been calculated.