…before you commit yourself to employment.
When it comes to hiring employees, there are a couple of things to keep in mind. For many entrepreneurs, this is a big step in their business, as it represents a serious commitment. Besides having a steady cash flow to be able to afford a monthly salary for an employee, an entrepreneur must also comply with the mandatory monthly retention and payment of social premiums and taxes, such as the payroll tax, social insurances (AOV, AWW and AVBZ) and employee insurances (ZV and OV). The main goal of the monthly contributions for social insurance and employee insurance is to cover the social responsibility employers have towards their employees.
All employers are obligated to calculate, withhold and pay the premiums and tax due to the authorities on the salaries paid to their employees. The calculated payroll tax and social premiums must be paid to the Tax Administration by the fifteenth of each month at the latest, and the calculated employee insurances must be paid to the Social Insurance Bank (SVB). These retention rules apply to all employees, regardless of whether they are permanent or part-time employees.
To properly comply with the monthly collection and payment of the payroll tax and social security contributions, the employer must register every new employee at the Tax Administration and the Social Insurance Bank.