Knowledge Base


Welcome to the Expatax Knowledge Base containing hundreds of answers to questions we received about topics concerning tax, payroll, accounting, legal, business etc. related to the Netherlands. Search in our Knowledge Base or browse the different categories. Expatax is a Dutch tax and accounting firm specialized in assisting international workers, freelancers and companies. Don't hesitate to contact us if you need assistance or check our website.


Where should I pay tax on my salary? In Spain where my employer is based or in the Netherlands where I work?


Question:

I am looking for somebody who can assist me with some tax-related matters.

I am working for a Spanish company, with a Spanish contract, but my company has moved me to the Netherlands to work for another company inside the same holding since I started with them last August. Where should I pay my income taxes? Physically I am working in the Netherlands, but the contract and the company are both Spanish and it is the Spanish company who is paying for my services. Is there any tax that I should pay in the Netherlands?

Answer:

Since you are actually working in the Netherlands you will have to pay tax in the Netherlands on the income you receive from your Spanish employer. Being a resident of the Netherlands you are already taxed here on your world wide income, which is only different based on a higher right of another country based for example on an applicable tax treaty. Like the standard tax treaty the tax treaty between the Netherlands and Spain divides the right to tax your salary to the Netherlands based on the place of work.

Being an employee it is the responsibility of your employer to arrange the withholding of wage tax on the salary which is paid to you. This means that your employer must register with the Dutch tax authorities as a foreign employer and set up a payroll administration in the Netherlands. If your employer has arranged an A1 statement it is possible to keep the payment of social security contributions in Spain.

Expatax can arrange the registration and take care of the payroll administration. See also www.expatax.nl/payroll-administration for more information about the legal requirements and our services.

It is also possible that you are put on the payroll of the company to which you are seconded but this will require additional work with respect to the applicable employment contract, reimbursement of costs etc.

Since you are seconded within the same group of companies the so called 183 days ruling will not be applicable either. So the fact that you work less than 183 days in a year in the Netherlands will not affect the obligation to set up a payroll administration in the Netherlands.

The above means that you will also have to file an income tax return in the Netherlands. Expatax can assist with that too.
Attached Files
There are no attachments for this article.
Comments (2)
Comment by bozhidar bozhanov on Fri, Jan 24th, 2014 at 7:43 AM
The answer mentions that the person is a resident of NL. But that might not be the case - he may still be resident of Spain. How does that change the tax situation?
Comment by Árjan Enneman on Wed, Apr 8th, 2015 at 4:41 PM
Relevant is where the work is done. If the person is working in NL but living in Spain, the standard situation based on the tax treaty is that the related income from employment in NL is taxed in NL. This depends on the actual work days. So if he is living in Spain he won‘t have to declare his world wide income in the Dutch tax return but only the income related to Dutch work days. For this the employer should put him on a Dutch payroll (unless there are only a few Dutch work days). If someone is working in NL for a couple of months then he will have to pay tax in NL on this income. But every case is different and requires investigation upfront.
Name
Email
Security Code Security Code
Related Articles RSS Feed
Tax assessment for 2014 may be higher than expected
Viewed 2603 times since Fri, Feb 20, 2015
Do we have a tax obligation in the Netherlands if we provide a service to a Dutch company for work done outside the Netherlands?
Viewed 17585 times since Sun, Apr 1, 2012
Can I open a savings account for my child and will he pay tax on the interest ?
Viewed 10063 times since Wed, Mar 21, 2012
What are the tax rates in 2012?
Viewed 2489 times since Tue, Nov 29, 2011
Dutch taxation on uk properties
Viewed 3333 times since Fri, Aug 30, 2013
What is the so called WOZ value of my house?
Viewed 31307 times since Sun, Nov 20, 2011
I still own a pension fund in the Netherlands after I left. Will I have to declare this in a tax return?
Viewed 4402 times since Mon, Jan 16, 2012
Can I get a copy of the Dutch tax assessments for previous years?
Viewed 708 times since Fri, Nov 6, 2015
What are the requirements if we want to send employees to the Netherlands?
Viewed 7273 times since Thu, Jan 26, 2012
Freelance tax return and 30% ruling
Viewed 3275 times since Sat, Feb 23, 2013
MENU