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Employment Relationship Statement: More certainty
On 1 January 2005 the Act regarding the Extension of the Legal Effects of Employment Relationship Statement Act took effect. By virtue of the new Act, commissioning parties enjoy statutory indemnification vis-à-vis commissionees who possess an Employment Relationship Statement profit from enterprise (VAR-wuo) or an Employment Relationship director-major shareholder (VAR-dga).
If the commissioning party keeps a copy of the VAR and the ID of the commissionee on file, no additional tax assessment for wage tax and social security charges will be imposed on the commissioning party. The VAR must of course be valid for the relevant period and cover the activities carried out by the commissionee at the commissioning party. A VAR that, for instance, covers IT-work has no effect if the commissionee carries out clerical work.
The commissionee can apply for a VAR at the Inland Revenue. In principle, a VAR will be valid for one calendar year. In case of assignments that go beyond that term, the VAR issued will continue to be valid for a maximum of 2 years, provided that any such assignment was accepted before 1 November of the relevant year.
For more information on the subject please contact Tanya van Nieuwstadt
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