How to operate as independent contractor in the Netherlands

Job opportunities in the modern day are quickly changing and improving. Workers have more liberty in their career selection and different job opportunities that fit their lifestyle better. Although the Covid pandemic was a terrible event, there were some positive things it brought us. One of those is definitely popularizing the work-from-home business model.

The number of freelancers and independent contractors is constantly increasing. The liberty of setting your work hours, changing companies, or working wherever you want, is very appealing to some people, which is why they decided to switch to this model. In the Netherlands, there are currently close to two million self-employed workers

It’s clear that the interest in self-employed working is at its pique and that it will keep increasing. However, if you want to start working as an independent contractor, you must follow the rules and regulations. For example, many aren’t aware that you still have to pay taxes in the Netherlands even if you don’t work full-time in a company. In addition, you still need to have a contract (regardless of how long the project will last). 

To ensure you don’t break any laws and clearly know if this business model fits you, here’s what you need to know about operating as an independent contractor in the Netherlands.

What is an independent contractor?

independent contractor agreement

Independent contractors are workers that work on a contract basis. That means they’ll sign a contract with a company to complete a particular project, do the work, and move on to work for other employers when they finish. This gives them a lot of flexibility and opportunity for growth since they aren’t committed to a single company in the long term. 

These are some of the things that are different for independent contractors compared to regular workers:

  • you change several companies you work for each year;
  • you work for a certain company temporarily until you finish the project;
  • you don’t have a full-time contract;
  • you own and purchase your equipment;
  • you arrange your own insurance and retirement program;
  • you don’t have a set working schedule.

Popular industries for independent contractors

Some of the most popular industries for independent contractors are:

  • marketing;
  • content writing;
  • IT;
  • customer service;
  • project management;
  • accounting and finance;
  • HR.

Of course, there are numerous other professions that you can do as an independent contractor. But, as with any business model, working as an independent contractor has benefits and downsides. 

Some of the benefits include:

  • you determine when you’re going to work – no set working hours;
  • you can work for international companies situated outside of your country of residence;
  • you have access to more job opportunities;
  • you can arrange part-time work more easily;
  • you save time as you don’t need to attend company meetings or waste time in traffic to arrive at your job;
  • you can leave a position more easily if you don’t like the job/company;
  • you can compare salaries and conditions in different companies and choose the better ones;
  • you can test out a company and decide to remain independent or switch to full-time.

Some of the cons of working as an independent contractor are:

  • your employer doesn’t provide health insurance or pension benefits;
  • the minimum wage can be lower;
  • you need to pay taxes by yourself;
  • you must buy your own equipment.

As the number of independent contractors is increasing, it’s clear that the pros outweigh the cons. Of course, the country from where you work can have different laws and rules with this type of work. However, the Netherlands has a built system with clear rules for independent contractors and freelancers.

Working as an independent contractor

independent contractors

To legally work in the Netherlands as an independent contractor or a freelancer, you must comply with the Foreign Nationals Employment Act (Wet arbeid vreemdelingen or Wav). If you reside in any EEA (European Economic Area) country or Switzerland, you can freely live and work in the Netherlands.

If you come to the Netherlands from a different country, you must comply with specific rules. Those rules are:

  • you must have a valid residence permit with an included note: “Employment is freely permitted. Employment permit not required.”;
  • you must have a valid passport with an officially accepted sticker for residency remarks, which includes the remark: ‘Work is freely permitted. Work permit not required.’;
  • your employer needs to have a valid work permit for hiring a foreign citizen.

These laws protect foreign workers from being underpaid and taken advantage of. All workers must have at least minimum salaries and be paid social security premiums and taxes. If the employers try to avoid those, they are running illegal businesses, with fines of up to 8,000 euros per illegal worker. These rules apply if you intend to work for a Dutch company.

Another scenario is if you’re already self-employed and want to continue your work in the Netherlands. Again, you must comply with the Foreign Nationals Employment Act. You don’t need a work permit if you’re coming from an EEA country or Switzerland, but you need to be able to prove that you’re truly self-employed. The Netherlands Labor Authority (NLA) provides that confirmation.

If you’re coming from a country outside the EEA or Switzerland, you don’t need a work permit, but you do need a residence permit. This is a residence permit allowing residence for a self-employed professional.

In that case, you’ll be considered a digital nomad in the Netherlands

Independent contractor and freelancer benefits

In the Netherlands, there are various benefits that independent contractors and freelancers enjoy. Some of those are:

  • benefits for low-income workers;
  • income support for older and partially disabled workers;
  • allowance for pregnant freelancers and independent workers;
  • childcare benefits.

In addition, with the UWV, you can voluntarily insure yourself so that you will get sick or occupational disability benefits if you get sick or become disabled from working.

Taxes for independent contractors and freelancers

independent contractor taxes

As any other worker, you’re obligated to pay taxes in the Netherlands. The incomes of freelancers are placed in the Box 1 tax rates in the Dutch system. These are the intended taxes for independent contractors or freelancers:

  • VAT and income tax for self-employed professionals – the Netherlands Tax and Customs Administration (Belastingdienst), which decides whether you are an enterprise for turnover tax and income tax, require freelancers/self-employed professionals to register;
  • VAT for resident businesses – when situated in the Netherlands as a freelancer/self-employed worker, you have to pay the turnover tax (VAT). You’re exempted in some cases (for example, working in international public transport or you supply goods to an entrepreneur in a different EU country);
  • VAT for non-resident businesses – as a freelancer or self-employed professional, you occasionally have to pay VAT when working on a short-term project in the Netherlands. The VAT you paid in the Netherlands may sometimes be refunded to you;
  • Income tax (IB) and health care insurance premium (ZVW) – In the Netherlands, independent contractors and self-employed professionals are required to pay income tax and health insurance fees.

There are a few more exemptions when the VAT is lower, such as working as a hairdresser or if you are in the food or medicine business. For others, the VAT will sum up to 21%.

On the other hand, freelancers and self-employed people are eligible for tax incentives. Two of them only apply if you spend more than 1,225 hours a year on work-related activities:

  • a yearly self-employment tax credit of €7,280;
  • a deduction of 2,123 euros for new business. Within the first five years of operation, this may be utilized three times;
  • a small business exemption also exempts 14% of profits from taxes in addition to these tax advantages.

Where do independent contractors find jobs?


Finding a job as an independent contractor or a freelancer is relatively easy, depending on your profession. There are various opportunities for all niches, but professions like web or software developers, web or graphic designers, and digital marketing experts will have an advantage.

Nevertheless, it’s still very possible to find work in other niches. Some of the most popular platforms for job seeking are:

  • LinkedIn;
  • Upwork;
  • Freelancer;
  • Fiverr;
  • Behance;
  • PeoplePerHour, and many others.

Of course, other methods exist, such as joining social media groups or getting recommendations from fellow freelancers.

Salary-wise, independent contractors and freelancers can earn high incomes if they possess the necessary skills. You can charge your clients more significant amounts due to the fact that your employer doesn’t cover your health insurance and other benefits. 

You can also use a different approach and charge less if you need experience and learning. Many companies will give you the opportunity to learn and grow as long as you don’t charge as much as the more experienced workers.

How do I become an independent contractor?

become independent contractor

To successfully become an independent contractor in the Netherlands, you should follow this structure.

Research the market

Thorough market research is a great starting point to set yourself up for success. First, examine the positions that you’re interested in. What are the criteria for getting the job? How much experience do the companies usually require? What is the average hourly rate they offer? Those are a few questions you should find answers to and position yourself accordingly.

Write a business plan

Writing a solid business plan is the next crucial step toward becoming an independent contractor. Calculate your expenses, the amounts you plan to charge clients, and the milestones you want to reach after certain periods.

It’s essential to remain realistic. Remember that starting as an independent contractor is a race and not a marathon, and only with enough experience can you expect a heftier income.

Determine your hourly rate

Once you get a reasonable estimate of the market and the average prices for similar services, you should determine your hourly rate. It can differ significantly from what you first expected (higher or lower), depending on the competition and hiring opportunities. 

Again, remain realistic and try not to overcharge or undercharge your services, as you’ll encounter difficulties in both cases.

Determine your working model

As we previously mentioned, different working models require different tax obligations and paperwork. That’s why it’s vital to know your exact working model so you can take care of any needed paperwork properly.

The best way to be sure about your working model is by filling out the entrepreneur check from the Dutch Tax and Customs Administration.

Handle the insurance and benefits

Since you’re obligated to pay for your own insurance and pension benefits (or most of it), this should be your next step. However, as you have certain benefits depending on your situation, you should examine those opportunities. 

Handle your administrative duties

Regardless of your profession, there’s a high chance that you’ll deal with things like invoices, GDPR, small business schemes, or quotations, to name a few. Keeping your books clean isn’t the easiest task, but it must be done. After all, you can always outsource those chores to professionals.

The difference between a freelancer and an independent contractor

freelancer vs independent contractor

Although very similar, there are a few differences between independent contractors and freelancers.

Freelancers usually work with a company for shorter periods (their projects are typically completed within a month).

Independent contractors usually work for prolonged periods, which can last for a few months or even over a year.

Freelancers almost always work by themselves.

Independent contractors can also work by themselves but can also work with an agency.

Freelancers usually have more clients as they finish projects faster.

Independent contractors usually have fewer clients over the course of a year.

Freelancers can choose their working schedules and hours.

Independent contractors may be able to choose their hours but sometimes are required to work on a set schedule.

Be your own boss

work as independent contractor

Independent contractors and freelancers are taking the job market by storm. As a result, more and more people are interested in this working model, which is why starting that career is an excellent investment for the future.

However, it’s crucial to follow the laws to work as an independent contractor. You can be fined tens of thousands of euros if you don’t fulfill all your legal obligations. In the Netherlands, there are numerous rules and paperwork you need to fill out to become a part of the system. 

If you find those confusing, complicated, or you aren’t sure in which category you belong, don’t hesitate to reach out. We’ll gladly help you to take care of all your taxes, obligations, and paperwork or find a job that’ll be the perfect fit for your criteria. Moving to a different country can be troublesome due to language barriers or specific laws you must follow. You can leave those to us and start packing your bags carefree.

Being your own boss can be very satisfying and a great step toward growing your career. And no better place to do it then in the business center of Europe.

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