fiscal info corporations

The liability for the payment of Dutch payroll taxes

Last updated: 19-11-2020

The withholding agent (company) bears the primary liability for the filing of the periodical wage tax returns and the payment of the salary taxes due in relation to its employees.

Under certain conditions the director(s) of the withholding agent can be held personally liable for the salary taxes due by the withholding agent but not paid (Directors liability). 

In certain specific cases also certain third parties can be held liable. This includes hirers of staff (Hirer's Liability or “Inleenaansprakelijkheid”), and  sub-contractors in a chain (Chain Liability od “Ketenaansprakelijkheid). 

The director’s liability 

As a general safety net for collection of salary taxes, the tax collection office can hold directors of the withholding agents liable if the  so-called “notification inability to pay” (“melding betalingsonmacht”) is not filed timely. 
This notification must be filed by (at least one) authorized director by the withholding agent within two weeks after the due date of the salary tax due. A similar but separate notification must filed if there is also inability to pay pension contributions due to a Sector Pension Fund. 

This potential liability applies to directors of the following legal entities:

  • a Dutch corporation (like a “BV” or “NV”)
  • an association (“vereniging”) that must file a Dutch corporate income tax return
  • a foundation ( “stichting”) that must file a Dutch corporate income tax return
  • a foreign legal entity person which has the obligation to file a corporate income tax return in the Netherlands

A standard form must be used for making the notification, and this form must be filed hard copy. A separate form has to be filed with the Sector Pension Fund.    

The non-filing or too late filing of the notification enables to tax collection office to hold the director(s) liable for the unpaid salary taxes (or pension contributions) unless the director can exonerate him/herself i.e. sufficient proof can be provided that he/ she is not to blame for the non-payment of the amounts due.  

It is noted that the foregoing provision exists next to the general director’s liability rules, which can make directors personally liable for the payment of certain taxes if the non-payment therefore can be  attributed to acts of apparent bad management (“kennelijk onbehoorlijk bestuur”). 

The Hirer's Liability (“inleenaansprakelijkheid”)  

Every company that uses personnel from a third party which is the declared formal employer and withholding agent (like an employment agencies or payrolling company), can be held liable for salary taxes due but unpaid by this third party on account of the personal “lend”. This applies to employees lend by resident and non-resident third parties. 

The company that uses the personnel from a third party, can protect itself form a claim on the basis of the “Personnel Lending Liability” rules by paying a (sufficient) part of the contract to a blovcked bank account of the third party lending the personell, as so-called G- account.      

For more information about the G-account,a and the procedure to establish a G- account, please consult our publication about The Hirer's Liability Regime in the Netherlands.  

The Chain Liability (“ketenaansprakelijkheid”)  

Any Dutch contractor who works with subcontractors can be held liable by the Dutch Tax Collection Office for unpaid Dutch salary taxes on behalf of employees of the engaged subcontractors (“chain liability” or “ketenaansprakelijkheid”).  

This liability can be avoided by the contractor by contributing a sufficient part of the contract sum to the Tax Administration directly, or to a blocked bank account of the contractor/ sub-contractor, a so-called G account. The funds transferred to this G-account must in first instance be used for the settlement of the salary tax due by the contractor/ sub-contractor on account of the employees involved.

For more detailed information about the Chain liability rules, and the use of a G-account please consult our publication about The Chain Liability Regime in the Netherlands.    


Go to >   The payroll service package of TAXci

Go to >    Index page - Payroll obligations in the Netherlands