The holiday season is over, most of you are back to work again so
it is time to look at the last issues for 2003. The tax office is
starting to send reminders for previous years including 2003. Unfortunately
some mistakes are made.
If you haven't filed your tax return yet don't hesitate to contact us. Look here for more information.
In this newsletter:
1. Tax office sometimes sends the wrong tax form
2. Digital filing of tax returns, business owners have been informed recently
3. The Expatica 'Welcome to the Netherlands' Fair
4. PC Prive
5. Disability insurance for business owners, the end of the WAZ
6. New Dutch Act on Child Care
7. Donations can be deductible
We have experienced that the tax office has been sending the wrong forms to expats lately. Most of the problems relate to the M form and the C form. Unfortunately it is not always clear to the tax office where somebody is living. It can happen that an expat is living in the Netherlands already for a couple of years and then suddenly receives an M form. Of course this leads to confusion: there has not been an immigration here. What is going on?
Officially the place of living is based on the actual facts and circumstances. Since the tax office doesn't always know these facts they have to base their administration on the registration of the municipalities. If somebody doesn't register at the local town hall this person may not be known by the tax office immediately. Any small change here can lead to recognition by the tax office which leads to the receipt of the M form. If the proper tax return has already been filed a letter of objection needs to be sent against the receipt of this tax return. If not the tax office will keep chasing you.
Another problem is the use of two systems by the tax office. Sometimes reminders are sent to expats who have filed their tax return months ago. This is caused by the use of different systems: one system says it is received and the other says it hasn't been received. We hope this will change in the near future. If you receive a reminder and you have filed your tax return already we suggest to inform them about it in writing and include a copy of the tax return which has been filed earlier and request them to grant you a provisional refund because of the long waiting time. From experience we know that phoning the tax office often leads nowhere.
If you have received correspondence from the tax office which you don't understand, contact us and we will try to solve the issue for you.
you know that Expatax also can take care of your payroll administration?
There are a lot of requirements in the Netherlands regarding the
set up of a payroll and the allowances etc. which can be paid to
the employee. Expatax is specialized in payroll administration,
especially for foreign companies.
Around 1 million business owners and freelancers in the Netherlands have received a brochure from the tax office early September about filing the tax returns digitally.
From 1st January 2005 business owners will be obligated to file their return for the income and corporate tax, VAT and EU deliveries digitally. The wage tax return will follow on 1st January 2006.
Our software will be able to take of this, if necessary the tax return can also be filed through the website of the tax office. For this you will receive login codes and a password from the tax office soon.
We can assist you with all your tax returns if you wish.
Come to the biggest expat fair in Holland. Everything you need to know in 1 day!
October 24 - 11am - 5pm in Beurs van Berlage Amsterdam
New to the Netherlands or looking to make the most of expatriate life?
Get the information you need from companies and agencies specialised in expatriate services, from banks, investment firms and insurance companies to schools and tax agencies. You'll find information on house hunting, finding a job, immigration and permits, staying long-term, and much more.
Meet the people who make expat life great, including the top clubs and associations, travel agents and sports teams.
Explore the expatriate life and your ambitions - higher education, career opportunities, your own business, travel and lifestyle possibilities. Every year, thousands of international managers and employees arrive in the Netherlands. The Welcome Fair answers the 101 questions you have about living here, in a unique environment where you can meet the right people face to face.
Includes entertainment and activities for all the family, presentations and demonstrations and a kids area.
Expatax will be there with a stand. Feel free to come visit us.
From Friday 27th August 17.00 pm the PC Prive has been ended immediately. This means that from that moment an employer can no longer give the employee a PC for personal use tax free.
Of course it is still possible that an employee takes home a laptop from work to work from home without being taxed.
From 1st August 2004 the WAZ has been ended. The WAZ is a 'state' insurance against disability and was paid through the annual income tax return. The insurance was expensive but the expected payments in case of disability low. The government has now decided that the market should take over the insurance. Arrangements have been made to prevent that business owners with bad health would be unable to insure themselves because they would be turned down by insurance companies. A special insurance can now be offered to these persons against the same premiums as for normal insurances.
The end of the WAZ involves risks for the business owner. What happens in case of disability if there is no insurance? Then the savings must be used to pay the costs of living. Disability will lead to a lower turnover and it may also lead to the end of the business. Statistics show that every 1 out of 10 business owners becomes disable to work. Accidents can always happen: at work, at home or during the holiday. You can fall down the stairs, get hit by a car or get problems with your heart. In 2003 56,000 persons received a WAZ payment because they were not able to function anymore like they were used to do.
If you don't have a disability insurance it may be wise to think about it now. That way your income will be secured in the future. You can decide yourself how much you would like to insure within the possibilities.
Benefit: the premium you pay for a disability insurance is tax deductible in your income tax return in the year of payment.
As from 1 January 2005 a new act on child care will come into effect. This act provides for the quality and financing of child care and applies to:
- Day nurseries (crèches)
- Host parent care (gastouderopvang)
- Out-of-school care (bso).
According to this act parents, employers and the government must jointly bear the costs of formal child care. The level of the contribution depends on the level of your income and will be paid through the tax authorities. You can apply for a contribution as from 15 September 2004.
The contribution will make child care affordable for parents with low incomes as well.
The employers of both parents are expected to contribute to child care. Ask your employer for information on the child care scheme or check the collective bargaining agreement (CAO). If the employer does not contribute to the costs, the government will do so.
If you do not have an employer, you may still receive a contribution, for example if you are participating in a reintegration programme, if you are a student or follow a compulsory integration course. Self-employed persons may also receive a contribution.
Money you donate to a good cause may be deductible. Donations to the following organizations can be deducted:
- organizations for the main cause
Examples are the Red Cross, WWF and Greenpeace.
These organizations must be based in the Netherlands. At the moment only 19 foreign organizations without a base in the Netherlands are pointed to be treated as an organizations for which donations are deductible.
Your donations are deductible if the total amount is at least 1% of your income. The maximum amount is 10% of your income. If you have a partner then both incomes are taken together.
You have to prove that you did the donations. A copy of the bank receipt will be sufficient. If you donate money to a specific organization every year then you can optimise the deduction by notarizing an agreement between you and the organization whereby you agree to donate a certain amount every year for five years. In that case no minimum and maximum amount are applicable and the notary costs can also be deducted.
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