With the recent announcement that the moratorium will expire on 1 January 2025, both clients and self-employed entrepreneurs are facing new challenges and opportunities. Simply put, this means that as of 1 January 2025, the (Dutch) Tax Authorities will resume active control of cases of pseudo self-employment.
The enforcement moratorium means that the Tax Authorities are temporarily exercising caution in enforcing the DBA act. This act, which was introduced in 2016, replaced the Verklaring Arbeidsrelatie (Declaration on Income Tax Status) (VAR) and was intended to tackle pseudo self-employment. In practice, however, it appeared that the act caused a great deal of uncertainty and unrest among both clients and contractors. For this reason, the government decided to suspend enforcement of the act until there was a new, clearer regulation. During the moratorium, enforcement would only take place in cases of obvious violation.
Pseudo self-employment involves risks for both the client and the self-employed. Both may be subject to additional taxes or fines from the (Dutch) UWV (Employee Insurance Agency) or the (Dutch) Tax Authorities. If a self-employed entrepreneur is considered to be an employee, he or she can also claim employee protection, such as protection against dismissal or the right to continued payment of wages in the event of sickness. With a limitation period of 5 years, the costs for clients can amount to tens of thousands of euros per year.
The announcement that the enforcement moratorium will expire on 1 January 2025 involves a number of important changes:
End to the of the cautious enforcement: As of 1 January 2025, the (Dutch) Tax Authorities will actively resume enforcement with regard to all cases of pseudo self-employment. This means that both self-employed entrepreneurs and clients need to prepare for possible checks and enforcement actions.
Stricter enforcement in high-risk sectors: The (Dutch) Tax Authorities have already announced tougher action in certain high-risk sectors, such as healthcare and construction. In these areas, pseudo self-employment is seen more frequently, and the risk of abuse is greater.
New legislation in the making: The government is working on new legislation that replaces the DBA act. This legislation should clarify the criteria that determine when a person is self-employed and when an employment relationship exists. This act is expected to enter into force in 2026, but details are still being developed.
Due to the expiry of the moratorium and thus the greater chance of checks and enforcement actions by the Tax Authorities, it is important for both clients and self-employed entrepreneurs to ensure that their working relationship meets the criteria for autonomy.
Stay informed: Keep a close eye on developments regarding the DBA act and new legislation on pseudo self-employment via our website.
Agreements: Ensure that any contracts with self-employed entrepreneurs contain the right legal provisions and meet the requirements for autonomy. In doing so, also evaluate whether what has been contractually agreed is in line with the daily practice.
Ask advice: Consider obtaining legal and/or tax advice to ensure that the situation complies with the applicable rules and to be prepared for the changes as of 2025.
The expiry of the enforcement moratorium on 1 January 2025 marks a new phase for clients who work with self-employed entrepreneurs in the Netherlands. While this can cause uncertainty, it also provides the opportunity to make working relationships stronger and more professional. With the right preparation and knowledge, it is possible that clients successfully navigate these challenging times and ensure a stable and compliant collaboration with self-employed entrepreneurs. Would you like more information or advice? Contact our experts!
