How to Hire Freelancers in the Netherlands: 5 Key Steps to Prevent False Self-Employment
Jan 29, 2025
As of January 1, 2025, the enforcement of the DBA (Deregulation of Assessment of Labor Relations) Act is active in the Netherlands. Tax authorities in the Netherlands are currently checking for false self-employment and can impose surcharges on companies if hired freelancers (called ZZP'ers in Dutch) are found to be employees in practice. The end of the enforcement moratorium aims to restore fairness in the labor market and prevent sham constructions where employees are incorrectly classified as self-employed.
The consequences for businesses are significant. Not only can fines and back taxes mount, but the tax authorities can reclaim up to five years if the rules are found to have been violated. Although many companies have already begun preparations, enforcement poses complex practical challenges for companies.
This blog offers a detailed analysis of the DBA Act, its implications for companies and possible solutions to stay compliant, including how companies can tackle it independently.
Let's take a look:
The DBA Act: A Brief Summary
The DBA Act, introduced in 2016, replaced the Declaration of Employment Relationship (VAR) and is aimed at tackling false self-employment. At its core, companies themselves are responsible for assessing the employment relationship with ZZP'ers (freelancers). Is it an employment relationship or not? If in retrospect it turns out that a ZZP'er should actually be considered an employee, additional taxes and fines may follow.
Important criteria that the tax authorities use to assess an employment relationship are:
Authority relationship: Does the company have control over how and when the work is performed?
Personal labor: Is the self-employed person required to perform the work himself, with no possibility of replacement?
Remuneration: Is there a fixed fee, regardless of the work performed, and does the self-employed person bear entrepreneurial risk? Or is the ZZP’er being paid hourly on effort only.
If these criteria are adequately satisfied, then the ZZP’er engagement may be properly classified as a self-employment relationship. If criteria is not met, then false self-employment and the back taxes, fines and penalties associated with the false claim, may be imposed.
Characteristics of employment vs. self-employment
One of the challenges with the DBA Act is determining whether an assignment can be performed by a ZZP'er or whether it is an employment relationship. To clarify this, you can use the characteristics associated with both situations.
The table below lists the most common characteristics for salaried and self-employed assignments. It is important to realize that these characteristics do not all have to be present in every case, but they can help paint a picture of the situation.
Most Important Case Law: the Deliveroo judgement
One of the most influential rulings in the area of false self-employment is the Supreme Court's Deliveroo ruling. This case ruled that Deliveroo's meal delivery workers, who were formally hired as ZZPs, should have actually been treated as employees. In this ruling, the Supreme Court emphasized that the practice of cooperation was decisive. The factors considered included the degree of authority and instruction by Deliveroo, the degree of embedding in the organization and the financial risks the delivery drivers did or did not bear.
This ruling forms the basis for the Tax Court's assessment in future enforcement cases. So companies working with self-employed workers should look closely at the nature of the partnership and the way the work is performed.
How can you prevent false self-employment? 5 Key Steps
It is crucial that companies act now to become and stay compliant. Here are some concrete steps companies can take to prevent false self-employment and avoid fines.
Review current contracts.
The first step is to take stock of all contracts with self-employed workers. This involves assessing whether these contracts meet the criteria of the DBA Act. It is important to check whether the self-employed person is actually an entrepreneur or whether there is a relationship of authority and an obligation to perform personal labor.
To do so, use the so-called web module, a questionnaire developed by the government that helps companies determine whether an employment relationship should be classified as employment. Among other things, this web module asks questions about:
The degree of authority and instruction the client can exercise.
Whether the self-employed person has the right to be freely substituted.
Whether the work is part of the core activities of the organization.
Who determines the location of the work and who provides the necessary materials.
Adjusting contracts and work processes
If the assessment shows that a working relationship does not meet the requirements of the DBA Act, it is necessary to adjust the contracts and work processes. This can be done by giving the self-employed person more freedom in the execution of the assignment, by making clear agreements on replacement and by ensuring that the self-employed person bears entrepreneurial risk himself.
Another option is to use a freelancer compliance provider with expertise in screening freelance work engagements for false self-employment. This allows companies to remain compliant and still employ flexible workers.
Documenting the collaboration
The tax authorities look not only at contracts, but especially at practices. Therefore, make sure all agreements and practices are well documented. This includes:
Clear assignment descriptions that emphasize the self-employed person's independence and that are more project or results oriented than effort oriented like an employee job description.
Evidence that the self-employed person can determine how and when the work is performed.
Documentation of all substitution agreements, rate agreements and entrepreneurial risk.
DBA Employment audit and adjustments.
Conduct a periodic audit of all self-employed individuals working within the organization. Assess whether conditions of self-employment engagements are still compliant with the DBA Act. If necessary, adjust current assignments to remain compliant.
Use of the web module
The government web module can help assess the employment relationship. Although the outcome of this module does not provide legal certainty, it does give a good indication of whether a self-employed person can work outside employment.
Risk score and key criteria for assessing employment relationships
In this section, we discuss the role of the risk score, as applied by the Tax and Customs Administration in the web module for the DBA Act. This system helps clients assess employment relationships with self-employed workers. We explain which components influence the risk score and provide insight into the main criteria that influence the risk of false self-employment.
The risk score of the Belastingdienst
The web module for the DBA Act assesses the employment relationship on the basis of a number of questions and assigns a score that gives clients insight into the risk of salaried employment. The risk score falls into three categories, which are explained below:
Key criteria for false self-employment.
The risk score is based on a number of key questions that play a role in assessing an employment relationship. These elements weigh more heavily in the score and are crucial to understand if you want to prevent false self-employment. Below we summarize the main factors that influence the risk score:
How do these factors affect the risk score?
The above criteria determine the outcome of the risk score and play a crucial role in determining the employment relationship. These factors are assessed by the Dutch Tax Administration (Belastingdienst) based on a point system, with certain answers weighing more heavily than others.
Authority and embedding: When the client exercises a great deal of control over the work or when the self-employed person structurally performs work normally performed by employees, this significantly increases the risk of false self-employment. The web module usually gives a lot of points for this, which can result in a high risk score.
Substitutability: The right to free substitution (also known as replacement or delegation) is an essential feature of self-employment. If a self-employed person does not have the ability to delegate to a substitute or replacement, the employment relationship is likely to be classified as employment.
Entrepreneurial risk and investment: Self-employed persons bear their own risk for their work and often make investments in materials or equipment. When this is not the case and the client provides all the resources and materials, for example, this is more likely to indicate an employment relationship.
Options for companies with complex assignments
For some assignments, it can be complex to meet all the requirements of the DBA Act. In those cases, there are some alternatives to still use flexible workers without coming into conflict with the legislation:
Agent of Record (AOR) Compliance: An AOR can help make the classification determination and support engagement and payment of self-employed workers. This ensures that companies do not risk retroactive penalties or taxes while still being able to use flexible workers.
Secondment: This is a secure option where the flexible worker is employed by a secondment agency. This eliminates false self-employment and allows companies to remain flexible in their workforce. However, the self-employed worker must still be employed.
Temporary employment contract: For assignments where the risk of false self-employment is high, a temporary employment contract can be a solution. This provides security for both the employer and the employee, while the project remains temporary in nature.
Final thoughts
The DBA Act imposes strict requirements on the hiring of self-employed and independent contractors. Starting in 2025, companies will be actively monitored for compliance with this law, which may result in high fines and surcharges. It is therefore crucial that companies start assessing their employment relationships and contracts now to prevent false self-employment. Companies can do this independently through a thorough inventory and adjustments in work processes, or by using services such as an AOR to ensure full compliance.
The responsibility for properly hiring self-employed workers lies with companies. However, careful preparation can prevent companies from encountering unpleasant surprises.
How Bubty can help with the DBA Act and false self-employment
In this blog, we wanted to give you insight into how to assess whether an assignment can be performed by a self-employed person within current (and new) legislation. As we have shown, this remains possible, but not in all situations. This requires action, particularly for enforcement in 2025. Failure to hire self-employed workers correctly in 2025 can pose significant risks for organizations, such as still having to pay payroll taxes and social security contributions, and in some cases paying fines. For the self-employed, lack of preparation can make them less likely to be hired.
Complying with the DBA Act is complex and challenging for many companies. This is why Bubty offers an in-depth audit of your current business practices with regard to hiring ZZP’ers. Make sure your company complies with the DBA Act and avoid additional taxes and high penalties in the future.
Want to learn more about the DBA Audit and how we can support you? Book a free consultation. Our team of experts is ready to guide you to carefree and compliant self-employment.
Disclaimer: This blog provides general information and should not be considered legal advice. For specific questions about the application of the DBA Act, we recommend that you contact a legal advisor.
