Want to be a pro at reading your Dutch payslip?
Assuming that you and you were grabbed the job, are done with the required paperwork, have already put in the functional working hours, and your well-deserved euros have arrived in your Dutch bank account. Now, it is time to check your Dutch payslip for those other decent advantages including pension, vacation time, and many other secondary benefits.
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At this juncture, Dhi ADT, renowned for its exceptional payroll services and employer of record solutions, steps in to ensure a smooth experience. We specialize in helping you navigate through not just the basic salary but also those additional perks that make a significant difference.
Here is a sample payslip! Let us now go through the explanations.
Fixed data
Part-time %: This is the percentage that the employee works on a weekly basis. This is calculated by dividing the actual weekly working hours by 40.
Gross salary: This is the gross salary of the employee on a monthly basis.
Hourly salary: This is the gross salary per hour. This is calculated by dividing the gross salary by 173,33 (The average amount of working hours in a month).
Tax credit: An employee is entitled to a tax credit on his income from one employment. “Toepassen” means that the tax credit is applied to the wages of the employee.
Table color: The table color indicates what type of income the employee earns. There is a white table (Wit) for income from current employment and a green table (Groen) for income from previous employment. These tables are used because both incomes are taxed differently.
Pay period: This is the period for which the employees are paid. “Maand” means that the employees are paid per month.
Minimum salary: This is the minimum salary that an employee should earn at all times on a monthly basis.
Annual salary BT: The annual salary BT is an estimation of what the employee will earn during the year. The annual salary BT is used to determine the percentage of BT.
Percentage BT: Special income such as bonuses and holiday allowance is taxed against a higher tax rate. The percentage BT shows the number of this higher tax rate.
Cat. value car: This shows the value of the business card of the employee.
Basis
Salary SWV: In the Netherlands, we pay social security premiums over our income. These premiums can be divided into national insurance premiums and employee insurance premiums. The premiums are contributed to the tax office to fund the benefits for, e.g., residents who are unemployed or who suffer from long-term sickness. This line displays the salary that is used to calculate the premium for social securities.
Salary LH: In the Netherlands, we pay income tax over all our income via the income tax return. To prevent the situation where residents would have to pay a big sum when they have filed their income tax return, we pay wage taxes each month. The wage taxes are then settled with the income tax return. This line displays the salary that is used to calculate the wage tax.
Salary ZVW: In the Netherlands, we pay a contribution to the healthcare law. This contribution is used to fund national health insurance. This line displays the salary that is used to calculate the contribution to the VW.
Tax credit: All taxpayers in the Netherlands are legally entitled to certain credits on their taxable income. This line displays the number that is credited from their taxable income.
Wage tax
Normal rate: This is the amount of tax that the employee pays against the normal rate in that month.
Special rate: This is the amount of tax that the employee pays against the higher rate in that month. Benefit rule: This rule has expired. However, the salary system displays it on the payslip automatically. We are looking to remove this line from the payslip.
Benefit: The same applies to the “benefit rule”
Days/hours
SV Days: These days are used to calculate the salary that an employee receives. The SV Days also include the days that an employee has been off sick.
Days worked: These are the days that the employee has actually worked.
Hours worked: These are the hours that the employee has actually worked. If the employee has a part-time % of 100, it will automatically display 173,33. (This is the average amount of working hours in a month)
Sickness days: These are the days that an employee has been off sick.
Reservations
Holiday allowance: This is an allowance that the employee builds up each month. It is calculated as 8% of the gross salary of the employee. Each year the total reservation will be paid out in May.
Leave hours: These are the hours that the employee has in his reservation for paid holidays.
In the wake of getting a payslip from your Dutch employer that appears as though it was tough to crack, you've figured out the code.
Need assistance hiring in the Netherlands? Contact us about our International EOR Service. Dhi ADT helps your business to enter into new markets, fast-track growth and avoid the hassle of incorporating a new entity by taking care of all local tax laws, payroll processing, social contributions and health insurance.
You can connect with us at experts@adtsolution.com
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