The client may be requested to open a G-Account once making employees available in the Dutch labour market. This ‘G-Account’ is effectively a blocked bank account through which necessary payments can be made, but only to the relevant tax authorities. The reasoning behind this account is simple: to prevent suppliers from avoiding payments of wage tax and social security.
Additionally, by following the G-Account’s methods and using the G-Account accordingly, the addressee can curb their liability for the addressee by paying a part of the amount indebted into a G-Account.
With this process, the addressee or recipient will pay for the services of the employee they are issued with, not including the amount for payroll tax and insurance contributions on the employees behalf likely owed. The addressee would then pay the latter amounts directly into the G-Account.
Rules
If all the rules have been followed and perceived and the addressee has paid the monetary amount into the G-Account then they can derive a presumption of payment from the transfer in question.
The rules request that the addressee perform various administrative operations. Should the addressee pay into the G-Account in line with the set restrictions and rules then the person in question will not be held liable for the set amount should you fail to pay the payroll taxes alongside other taxes and social security contributions.
If and how a G-Account is used is solely up to the recipient and the supplier. It is advisable to make arrangements in advance before committing to a G-Account.
Opening an Account
Opening a G-Account is relatively simple. You can open a G-Account after dealing with a ‘Recipient’s Liability G-Account’ application. To this application and contract, three parties are included: The supplier (you), the banking establishment with whom the G-Account has been opened and the relevant tax authorities.
The Dutch tax authorities can supply the forms involved for opening a G-Account.
For more information on Working in Netherlands or Contracting in Europe visit the Euro Accountancy & Finance Services website.
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