Tax Treaties

It is possible that even though your employee appears to live in the Netherlands, he/she is still considered to be a non-resident taxpayer. When the Dutch employer withholds taxes on his wages, and his home country (taxable country of residence) will tax him on his world income (including the Dutch income), this may lead to double taxation.

 

To avoid this, the Netherlands has concluded Tax Treaties with a large number of countries. A tax treaty is an arrangement between two countries about which of them has the right to tax certain types of income. In this way, a situation is avoided where you would have to pay tax in two countries on the same income. Treaties with different countries are not always identical in content. If the Netherlands has concluded a tax treaty with the country from which you receive income, you can only find out about the exact tax consequences in the Netherlands by consulting that treaty.

 

If there is no tax treaty between the Netherlands and the country concerned, the 2001 Double Tax Decree will apply. The application of this Decree will also prevent double taxation.

 

The tax treaties do not contain rules covering the levy of national insurance contributions. This is subject to other (international) regulations. For more information, please see the section on Social Security

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