Sometimes we are contacted by potential clients or corrected by employees of existing clients that certain reimbursements should not be taxed. What is taxable salary?
What is taxable salary?
Basically a very simple answer: all you receive from your employer, unless it is exempted from taxation.
What is often asked for:
We like to pay our employee a fixed monthly amount tax free for costs he or she makes for the employment. That is not possible. If costs are made that could be reimbursed, like costs during travel, or food with a client, then these costs need to be specified and the exact amount is reimbursed.
The employee uses one of the residential houses we have at our disposal till the moment he or she can find his or her own place. The rental value of this place is a remuneration in kind subject to wage tax.
The employee assumes the employer can pay for the private health care insurance cost. That is not possible, if done, this is a net payment that needs to be crossed up.
Travel costs are maxed to 0,19c per KM distance. There is a minimum distance of 10km and maximum distance of 75 km, one way.
Sometimes the employee uses the private car for company use. To go to a course, visit a client or similar activities. Then the petrol is often paid for. If there is no company car used by this employee, no car costs can be reimbursed tax free. All travel costs are to be supposed in the 0,19c per KM.
Home office costs such as part of the rent, part of the utility costs, part of the interior (desk) or internet connection, is claimed for. All reimbursements are regarded net salary payments and need to be crossed up.
All is taxable salary?
That is the best way to approach the subject. Ofcourse there is the werkkostenregeling with a limited number of possibilities. However, that amount is quickly fully consumed by the Christmas gift, the employee dinner, or other aspect the employer thinks he or she can make the employee happy with.
We understand the need to get something tax free, but you should also understand the Dutch tax office that would like to keep it simple. Keeping it simple is stating all the employee gets is taxed. In the past it has been complex enough and the wish of the people and politic was and is to make it simple. This time that was a success.