Wage tax obligation for supervisory board members abolished – choices to be made

Posted on 4th January, 2016

Estimated reading time 3 minutes

From 1 May 2016, members of the supervisory board of directors will no longer be considered as employees for Dutch wage tax purposes.

Further to the discussions in the Senate with respect to the Deregulation of Assessment of Independent Contractor Status Act (Wet Deregulering Beoordeling Arbeidsrelaties, see article here), the State Secretary of Finance has published a decree by which the members of the supervisory board of directors will no longer be considered as employees for Dutch wage tax purposes.  The decree anticipates the change of the Wage Tax Act from 1 January 2017.

How does this affect my business?

From May 2016 the decree offers the company and the supervisory board member/s a choice - to either withhold wage tax, or not.  However, from 1 January 2017 the wage tax will, by law, no longer apply to the supervisory board member/s unless the company and the board member/s request the tax inspector to apply the ‘opting-in’ scheme.

Employers are advised to carefully consider the choice to opt-in or not on a case by case basis as it may have wide-reaching consequences on tax and social security matters for the employee, such as the:

  • application of the 30%-ruling,
  • tax position of the non-resident supervisory board member,
  • reporting position for personal income tax,
  • social security position, and

the contribution for the Health Care Act (Zvw bijdrage).

Further information

For further information or to discuss how this will affect your company, please contact Frank Dekker on +31 10 224 64 28, Loyens & Loeff Netherlands.  

Further reading

Decision BLKB2016-265M, LB, Fictitious employment (Dutch)


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