Payroll taxes should be calculated on all forms of remuneration the employee receives on the basis of his/her employment. The main form of wages is 'wages in money': salary, holiday pay, overtime pay, commission, 13th month's salary, and anything else paid to the employee in money as a remuneration for his work. Other forms of wages are remuneration 'in kind' and the so-called (tax-free) allowances and provisions.
Practice has shown that the costs incurred by non-resident employees for the purpose of exercising their employment in the Netherlands can roughly be divided into two categories:
Cost allowances are part of the wages insofar as they are not exempt under Dutch tax law.
Expatax is familiar with the (tax-free) allowances and provisions that can be made to employees.
An employer can pay a tax-free reimbursement for the costs actually incurred by the employee in connection with his work. One condition in this respect is that it is demonstrated that the costs for which the reimbursement is paid were actually incurred.
The (original) invoices and bills showing these costs should be retained with the accounts. Also bear in mind that (intended) expense allowances can only be paid on the basis of Dutch tax law. Whether different rules and amounts are applicable to staff in the country where the employer is established, is irrelevant. After all, the staff members supplied are working in the Netherlands, which means that only Dutch tax law (and employment law) will be applicable.