CROSS-BORDER TAXATION OF HUMAN CAPITAL
Nathalie Stroobants
Week 3: INTRODUCTION INTERNATIONAL AND EUROPEAN SOCIAL SECURITY - CROSS-
BORDER EMPLOYMENT
Case 4. Interpreters
Linquo Ltd. is a company established in London (the United Kingdom). Linquo Ltd. is a language centre
which provides university-skilled translators and interpreters. The main business of Linquo Ltd. is
translatnn documents like artcless books and tax advice and providinn interpreters. In August 2017,
Linquo Ltd. received two orders: one from Berens BV, a company established in the Netherlands, and one
from Fleur SARL, a company established in France. Consequently, Linquo Ltd. will send one of its
employees, Philippe Sennolds to Berens BV.
For the order of Fleur SARL, Linquo Ltd. needs to send a Polish-speaking interpreter to Fleur SARL. As no
employee of Linquo Ltd. is a Polish-Speaking interpreter, Linquo Ltd. employed a new employee as from 1
September 2017s Sarah Baxon, on the basis of a one-year employment contract. Already on her frst
workday (01.09.2017), Sarah Baxon will be posted to Fleur SARL. Both Philippe Sennold and Sarah Baxon
are residents of the United Kinndom.
Philippe Segnold will be posted to Berens BV for a period of 9 months. During these 9 months, Philippe will
live in the Netherlands from Monday to Friday but stays in the United Kingdom for the weekends. Linquo
Ltd. did not request an A1 Certicate for him.
The expected postng-tme of Sarah Baxon to Fleur SARL is 11 months.
Afer working a few months for Berens BV in the Netherlands, Philippe Segnold receives a statement from
the Dutch tax authorites statng that he is socially secured in the Netherlands and consequently that he is
oblined to pay social security contributons in the Netherlands because he does not have an A1
Certicate.
FACTS
Linquo Ltd
Residence: United Kingdom
Main business: is translatng documents like artcles, books and tax advice and providing
interpreters
Berens BV
Residence: Netherlands
Fleur SARL
Residence: France
Phillipe Segnold
Residence: UK
Employed as of: assumed to be employed for a while
Posted to Berens BV for a period of 9 months minus weekends = 173 days
Does not have A1 Certfcate
Assumed he is posted efectvely as of 01.09.2017 like Sarah
Sarah Baxon
Residence: UK
Employed as of: 1 September 2017
Posted to Fleur SARL for a period of 11 months = 335 days
Does have an A1 certfcate
Posted on frst day of employment
1
, CROSS-BORDER TAXATION OF HUMAN CAPITAL
Nathalie Stroobants
a. Are the Dutch tax authorites right?
The answer is that the Dutch authorites are NOT right, as A1 certfcates can be acquired AFTER being posted
(FTS, Banks)
The A1 form certfes which social security legislaton applies to the holder of the form. It will
generally be needed in situatons where you, as an employed or self-employed person, have a
connecton through your employment or self-employment with more than one EU country
Under the EU rules a person is only subject to the legislaton of one country at any one tme.
The A1 is issued by the country to whose legislaton you are subject and confrms that you are not
subject to the legislaton of any other country you are connected with – in other words you will have
no obligaton to pay social security (including health insurance) contributons in the other countries.
b. Philippe Segnold read something about the Dutch 30%-ruling. He comes to you for advice. Would you
advise Philippe that this 30%-ruling applies in his case or not and why?
CONDITIONS TO APPLY THE 30% FACILITY RULE
You need the Belastngdienst’s permission to apply the facility.
To obtain this, you and your employer should submit an applicaton.
The 30% facility applies to you if you were recruited outside of the Netherlands or seconded from a country
other than the Netherlands to work in the Netherlands.
CONDITIONS INCLUDING THE FOLLOWING WILL APPLY TO MAKING USE OF THE 30% FACILITY WITH EFFECT
FROM 1 JANUARY 2012:
1. You have an employment relatonship.
a. Employees who work for you in a permanent establishment in the Netherlands.
b. Employees you post, hire out or second personnel in or to the Dutch labour market.
c. Employees who work for you and for whom you opt to act as a withholding agent.
2. You have speciic expertse that is not or is only barely available on the Dutch employment
market.
a. You are deemed to possess that expertse if your salary not including the tax-free allowance
in the Netherlands is at least in 2017: 37,000 euros.
b. Under the age of 30 and have a Master's degree: € 28,125
c. Work conductng scientfc research: no salary bracket
Scarcity requirement
In exceptonal situatons your employee will not only need to comply with the income standard, but will also
need to comply with a scarcity requirement: your employee's expertse must be unavailable or virtually
unavailable on the Dutch labour market.
This is the case when virtually all employees in a specifc sector comply with the income standard,
such as professional footballers.
You will then also need to demonstrate the scarcity of your employee's expertse.
3. You have a valid decision.
a. When you wish to apply the 30%-facility then you will frst need to apply to the Tax and
Customs Administraton for a decision. You can apply for this decision by completng the
'Applicaton Income tax and natonal insurance 30% facility.’
Channe of employer
The 30%-facility can, subject to certain conditons, remain applicable to an employee who
channes employer during the term of the decision.
In that case, the new employer together with the employee must submit a new request.
2
Nathalie Stroobants
Week 3: INTRODUCTION INTERNATIONAL AND EUROPEAN SOCIAL SECURITY - CROSS-
BORDER EMPLOYMENT
Case 4. Interpreters
Linquo Ltd. is a company established in London (the United Kingdom). Linquo Ltd. is a language centre
which provides university-skilled translators and interpreters. The main business of Linquo Ltd. is
translatnn documents like artcless books and tax advice and providinn interpreters. In August 2017,
Linquo Ltd. received two orders: one from Berens BV, a company established in the Netherlands, and one
from Fleur SARL, a company established in France. Consequently, Linquo Ltd. will send one of its
employees, Philippe Sennolds to Berens BV.
For the order of Fleur SARL, Linquo Ltd. needs to send a Polish-speaking interpreter to Fleur SARL. As no
employee of Linquo Ltd. is a Polish-Speaking interpreter, Linquo Ltd. employed a new employee as from 1
September 2017s Sarah Baxon, on the basis of a one-year employment contract. Already on her frst
workday (01.09.2017), Sarah Baxon will be posted to Fleur SARL. Both Philippe Sennold and Sarah Baxon
are residents of the United Kinndom.
Philippe Segnold will be posted to Berens BV for a period of 9 months. During these 9 months, Philippe will
live in the Netherlands from Monday to Friday but stays in the United Kingdom for the weekends. Linquo
Ltd. did not request an A1 Certicate for him.
The expected postng-tme of Sarah Baxon to Fleur SARL is 11 months.
Afer working a few months for Berens BV in the Netherlands, Philippe Segnold receives a statement from
the Dutch tax authorites statng that he is socially secured in the Netherlands and consequently that he is
oblined to pay social security contributons in the Netherlands because he does not have an A1
Certicate.
FACTS
Linquo Ltd
Residence: United Kingdom
Main business: is translatng documents like artcles, books and tax advice and providing
interpreters
Berens BV
Residence: Netherlands
Fleur SARL
Residence: France
Phillipe Segnold
Residence: UK
Employed as of: assumed to be employed for a while
Posted to Berens BV for a period of 9 months minus weekends = 173 days
Does not have A1 Certfcate
Assumed he is posted efectvely as of 01.09.2017 like Sarah
Sarah Baxon
Residence: UK
Employed as of: 1 September 2017
Posted to Fleur SARL for a period of 11 months = 335 days
Does have an A1 certfcate
Posted on frst day of employment
1
, CROSS-BORDER TAXATION OF HUMAN CAPITAL
Nathalie Stroobants
a. Are the Dutch tax authorites right?
The answer is that the Dutch authorites are NOT right, as A1 certfcates can be acquired AFTER being posted
(FTS, Banks)
The A1 form certfes which social security legislaton applies to the holder of the form. It will
generally be needed in situatons where you, as an employed or self-employed person, have a
connecton through your employment or self-employment with more than one EU country
Under the EU rules a person is only subject to the legislaton of one country at any one tme.
The A1 is issued by the country to whose legislaton you are subject and confrms that you are not
subject to the legislaton of any other country you are connected with – in other words you will have
no obligaton to pay social security (including health insurance) contributons in the other countries.
b. Philippe Segnold read something about the Dutch 30%-ruling. He comes to you for advice. Would you
advise Philippe that this 30%-ruling applies in his case or not and why?
CONDITIONS TO APPLY THE 30% FACILITY RULE
You need the Belastngdienst’s permission to apply the facility.
To obtain this, you and your employer should submit an applicaton.
The 30% facility applies to you if you were recruited outside of the Netherlands or seconded from a country
other than the Netherlands to work in the Netherlands.
CONDITIONS INCLUDING THE FOLLOWING WILL APPLY TO MAKING USE OF THE 30% FACILITY WITH EFFECT
FROM 1 JANUARY 2012:
1. You have an employment relatonship.
a. Employees who work for you in a permanent establishment in the Netherlands.
b. Employees you post, hire out or second personnel in or to the Dutch labour market.
c. Employees who work for you and for whom you opt to act as a withholding agent.
2. You have speciic expertse that is not or is only barely available on the Dutch employment
market.
a. You are deemed to possess that expertse if your salary not including the tax-free allowance
in the Netherlands is at least in 2017: 37,000 euros.
b. Under the age of 30 and have a Master's degree: € 28,125
c. Work conductng scientfc research: no salary bracket
Scarcity requirement
In exceptonal situatons your employee will not only need to comply with the income standard, but will also
need to comply with a scarcity requirement: your employee's expertse must be unavailable or virtually
unavailable on the Dutch labour market.
This is the case when virtually all employees in a specifc sector comply with the income standard,
such as professional footballers.
You will then also need to demonstrate the scarcity of your employee's expertse.
3. You have a valid decision.
a. When you wish to apply the 30%-facility then you will frst need to apply to the Tax and
Customs Administraton for a decision. You can apply for this decision by completng the
'Applicaton Income tax and natonal insurance 30% facility.’
Channe of employer
The 30%-facility can, subject to certain conditons, remain applicable to an employee who
channes employer during the term of the decision.
In that case, the new employer together with the employee must submit a new request.
2
