From May 1, 2016 the new DBA Act will take effect. In this video Marieke Franken explains what you have to do as a freelancer to comply with the new DBA Act. Do you have any questions? Feel free to contact us.
What is going on?
On 1 May 2016 the VAR (Declaration of Independent Contractor Status) was abolished and the new DBA Law entered into force. Because of this new law, clients and independent professionals will work with model agreements that have been assessed by the Dutch Tax Authorities beforehand. At least, if it is necessary, because it is not always the case. And it is not mandatory either.
What is the goal of these model agreements?
The goal of these model agreements is to make it clear that there is no employment contract, but independent entrepreneurship. It is supposed to counteract false self-employment of independent professionals who have actually just been employed by a company.
What do you have to do as an independent professional?
Determine if you need a model agreement. Independent professionals and clients have until 1 May 2017 to determine if it is necessary to work with a model agreement. During this period, they can also determine what model agreement fits the way they work best.
When do you not need a model agreement?
In a lot of cases it is clear that an independent professional is not an employee, but working as an independent professional. Think of a painter who is always working for different individuals. In cases like these you do not have to use a model agreement.
When do you need a model agreement?
Working with model agreements is not mandatory and only meant for situations in which there is doubt about the nature of the employment relationship. Think of a freelance journalist who always works for the same newspaper. Or a plumber who always works for the same contractor.
What model agreement should you use?
If the independent professional and the client need a model agreement, they can look for a model agreement that fits the way they work on the website of the tax authorities.
What should you record?
The independent professional and the client have to record what model agreement they will work with. The independent professional can do this, for example, by including the model agreement as an attachment with the email in which he makes agreements with his client. Or by referring to the number of the model agreement.
Do you have to enter a new agreement for every new assignment?
No, you do not have to enter a new model agreement for every assignment. As long as the independent professional and his client work according to the agreements in the model agreement, there is no question of employment and the client does not have to deduct social security contributions.
How long is a model agreement valid?
If nothing changes about the work situation and the agreements in the model agreement, the agreement will be valid for a maximum of 5 years. If your work situation changes, you will have to see if you can still work with the model agreement, or if it has to be adjusted to the changing work situation.
What else should I pay attention to?
To qualify as an independent professional for the income tax you have to meet a number of criteria set by the tax authorities. As the hour criterion, working for several clients, advertise for your company, doing business investment and run entrepreneurial risk. However, this is unrelated to the DBA Law.
Please contact us!
As a freelancer or self-employed worker you often need to submit a VAR declaration to qualify for a project of a client. The VAR declaration is issued by the Belastingdienst after sending in a questionnaire. By this the client is indemnified from deducting several kinds of social insurance contributions.