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Assignment in the Netherlands: 183 days rule

Would you like more information about the 183 days rule regarding an assignment in the Netherlands?

MFFA Belastingadvies | Tax Advice

Assignment in The Netherlands: 183 days rule

An assignment in the Netherlands or a secondment to the Netherlands of employees, is nowadays one of the instruments for internationally orientated companies to expand their business. In order to structure the business as good as possible, correct delegation structuring has become very important for these companies.

Short term employment

An assignment in the Netherlands or a short-term employment to the Netherlands may lead for employees and employers for uncertainty where to pay the income taxes and social security. We assist employees and employers with avoiding excess costs and unexpected corporate and income tax risks when people are seconded to another country or seconded / assigned within a group company (intra-group assignments).

Assignment in The Netherlands: 183 days rule

Permanent establishment risk

MFFA Tax Advice assists to monitor the risks and pitfalls of the delegates activities abroad. For example, employment for a short term in the Netherlands might trigger the creation of an unwanted permanent establishment (branch) for the foreign company. As a result, compliance and other registrations might be required. The risk is only there if the employer is not established yet in the country where the work of the delegate is performed. See also our article about permanent establishment risk in the Netherlands.

 183 Days rule Netherlands

A pitfall with respect to an assignment in the Netherlands and the 183 days rule, is that it is generally assumed that in case the 183 days has been exceeded, the right to tax shifts to the country where the work is physically exercised. This is not always true.


183 days rule – Assignment in the Netherlands / working temporary in Holland

If employees are seconded to / assigned in the Netherlands, the main rule is that the country where the work is physically exercised is allowed to tax the employment income. However, the country of residence of the employee has the right to tax, in case:

  • the employee has not spent more than 183 days in the country where the work is physically exercised; and
  • the remuneration is not paid by, or on behalf of, an employer who is a resident in the state of the secondment / assignment; and
  • the remuneration is not borne by a permanent establishment of the employer in the state of the secondment / assignment.


The abovementioned might sound easy. However, the interpretation of “employer” (bullet point 2) is different in various countries and the OECD has not defined a definition of “employer”. Some countries apply the economic and some the formal approach.


Economic employer approach and the formal / contractual employer approach

Example assignment in another country:

If an employee is to commence an assignment within a group company in another country (intra-group assignment), and the person stays formally employed at the sending company but will perform work for the receiving company, while the salary costs are carried by the receiving company (recharged by the sending company).

Seconded employee

In that case several countries will consider the “employer” in the country who bears the salary costs because this country faces the economic risk and responsibility for the work performed by the delegate (also called economic employer approach). Other countries consider only formal or contractual employers as the “employer” of the seconded employee (also called formal / contractual approach).

Economic employer

Even though it is clear that the receiving company is not the formal employer, it could still be qualified as the “economic employer”. As a result, the country of residence has not the right to tax (see above)

Economic approach

The Netherlands recognizes both approaches. However, more weight is put on the economic approach whereby a particular focus is on the authority to instruct the individual and the entity that carries the risks for the result of the work.


Tax risks

In case employees are working in the Netherlands (long and short time) we can assist with the following tax services with respect to an assignment / secondment in the Netherlands:

  • Research if there is a tax risk regarding “employment” or who is the “employer”;
  • Arrange a (shadow) payroll administration; (if necessary)
  • Prepare and draft employment contracts;
  • How to invoice the contract party from a Dutch VAT perspective;
  • Contacting our contact persons at the Dutch tax authorities

More information about an assignment in the Netherlands?

Is your company planning to commence an assignment in the Netherlands for an employee? Or are you self-employed entrepreneur / freelancer and want to do business in the Netherlands?

You can contact us through our contact form or call 085 003 0140 from within the Netherlands, or +31 (0)20 261 5615 from abroad.

See also the English website of the “belastingdienst”.



Do you have any questions or do you want to know more about our prices?

  E-mail: info@mffa.nl

In the Netherlands: 085 0030140
From abroad: +31 20 2615615

Amsterdam: Keizersgracht 62, 1015 CS
Amstelveen: Laan van Kronenburg 14, 1183 AS
Bovensmilde (Assen): Witterweg 2, 9421 PG
The Hague: Schenkkade 50, 2595 AR
Eindhoven: Hurksestraat 64, 5652 AL

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Specialist in: Expats | International Companies , MFFA Belastingadvies | Tax Advice
Jeroen Mijlof graduated in economics and tax law at the University of Groningen. He has + 15 years’ experience in National and International Tax Law for both individuals and companies. Before MFFA he worked at the Dutch tax authorities, KPMG Meijburg and RSM International Tax Services .