Enforcement of false self-employment 2024 and 2025

Christiaan Cornet

Tax director

20 maa. `24

The Tax Administration still has the ambition to lift the enforcement moratorium on employment relationships by January 1, 2025. Recently, the enforcement plan for 2024, a perspective note, and a memo providing guidelines on the relationship between an indication in wage tax and turnover tax and income tax have been published.

Employment relationships

The government suspects that in too many cases, the use of self-employed persons (zzp’ers) is not in line with laws and regulations and that there is a case of false self-employment. The assessment of whether there is an employment contract (employee) or a service agreement (self-employed person) lies primarily with the client and the worker. In practice, this assessment is challenging.

Balance restoration

Both in the enforcement plan: employment relationships 2023 and in the perspective note among other measures, the three measures previously announced by the government to restore balance are included:

Creating a fairer playing field between employees and self-employed individuals;
Clarification of the rules regarding the assessment of employment relationships and the introduction of a legal presumption;
Improving enforcement against false self-employment and lifting the enforcement moratorium by January 1, 2025, through three tracks:

Active collaboration with the market;
Specific attention to high-risk areas;
Regular customer treatment.

Enforcement of employment relationships in 2024

Does the Tax Authority determine there is an employment relationship? In 2024, the Tax Authority only imposes correction obligations, retroactive tax assessments, and potentially fines in cases of malicious intent, as well.

The enforcement moratorium means the Tax Authority, in all other cases, only provides guidance, which as a business owner you must follow. Typically, you will have three months to incorporate the employment relationship into the wage tax return as employment. You can also consider whether you can structure the employment relationship differently, so it qualifies as work outside of employment.

Enforcement plan for employment relationships in 2024 and 2025

In the enforcement plan for employment relationships in 2024, the phase for 2024, “Towards the abolition of the enforcement moratorium,” will be further elaborated. Since the ambition is to lift the enforcement moratorium by January 1, 2025, the enforcement plan for 2025 will likely have the phase “Enforcement without enforcement moratorium”.

Get started with the assessments of employment relationships

With lifting of the enforcement moratorium the Tax Authority will no longer limit itself to providing guidance in cases of incorrect classification of an employment relationship. Starting from January 1, 2025, the Tax Authority can again impose correction obligations and additional tax assessments in all cases. From this date a fine can also be imposed in applicable cases.

Advice! We advice you to start assessing your various employment relationships. Do you suspect instances of false self-employment within your company or agreements for services when working with freelancers? Our advisors are happy to assist you with this challenging assessment.

Guidelines on the implications for value-added tax (VAT) and income tax

The Tax Authority has also published a memo containing guidelines for Tax Authority employees regarding the relationship between an instruction in wage tax and the existence of an employment relationship for value-added tax (VAT) and income tax purposes. Roughly, these guidelines come down to the following:

If a client of the Tax Authority receives an instruction indicating the existence of an employment relationship, this generally also affects income tax. Furthermore, the classification for income tax purposes also depends on other facts and circumstances concerning the contractor. In principle, the Tax Authority does not take action regarding tax years preceding the moment of the instruction at the contractor.
If a client of the Tax Authority receives an instruction indicating the existence of an employment relationship, this can also have implications for the VAT position of both the client and the contractor. The Tax Authority exercises caution in correcting the VAT position of both the client and the contractor for periods preceding the moment of the instruction.