Taxation of international executives
The short-term assignee will probably be considered a non-resident of the Netherlands during the short-term assignment to the Netherlands. This will ultimately depend on the concrete facts and circumstances surrounding the individual’s position.
Based on the economic employer approach that the Dutch Supreme Court has adopted the short-term assignee could be subject to Dutch income tax as of day one (under certain conditions). The foreign employer will have a withholding obligation for Dutch wage tax purposes (under certain conditions, a Dutch group company can act as the withholding agent); the Dutch company can be held liable in case of under-withholding.
All information contained in this publication is summarized by Meijburg & Co Tax Lawyers, the Netherlands member firm affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity, based on the Dutch Personal Income Tax Act 2001 and the Dutch Wage Tax Act 1964. These laws can be found at https://wetten.overheid.nl.
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