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Social security in the Netherlands

The social security system in the Netherlands is one of the most complicated in the world and, as a result, complying with the administrative requirements involved in employing foreign workers in the Netherlands can be a daunting task. Similarly, foreign (agency) contractors working in the Netherlands face a multitude of laws and regulations. Dutch Umbrella Company knows all the ins and outs of social security requirements and legislation so we can support you and your contractors when they work as an expat in the Netherlands.

Dutch social security, how does it work?

When you come over to the Netherlands to work as an expat one of the requirements is that you register with municipal authorities in your place of residence. You will then be provided with a registration number called BSN. This also serves as your tax and social security number.

In addition to paying income tax, under Dutch social security law, employees in the Netherlands contribute to several national insurance schemes and are often obliged to participate in (institutional) pension plans. Such obligations are the result of the collective labour contracts that apply to most sectors of industry and over 80% of the Dutch workforce. There are three main strands that constitutes the Dutch social security system:

  • National insurance which includes pension (AOW) and child benefit (AKW)
  • Employee insurance which includes unemployment benefit (WW), long-term disability (WIA) and sickness (ZW)
  • Social assistance if needed, provided by municipalities

Dutch social security exemptions

Living and working in the Netherlands requires a contribution to the Dutch social security system. There are, however, a number of exceptions.

Foreign nationals whose native country has a social security agreement with the Netherlands are exempt as long as they continue to make social security contributions in their native country under the terms of the treaty. In order to apply for exemption from the Dutch system, a E101 certificate confirming social security coverage in the native country will usually suffice. Likewise, foreign nationals temporarily posted in the Netherlands are eligible for continuation of their social security coverage under the legislation of their native country if a treaty is in place.

Foreign nationals from countries with which the Netherlands shares no social security treaty may be required to pay contributions and be eligible for benefits in both. In some cases, people with short-term positions (less than six months) are exempt from employee insurance scheme contributions, but never from the national insurance schemes.

Dutch social security benefit eligibility

Recent changes to Dutch social security legislation have made the eligibility criteria for claiming welfare benefits more restrictive. Many temporary, self-employed and fixed-term contract workers are now excluded. In general, however, anyone with a residence and a work permit is covered by the Dutch social security system. For more detailed information, please consult the “Introduction to the Dutch Social Security System” published by the Dutch Ministry of Social Affairs and Employment. You can of course always ask support from our Expat Desk as we know everything you need to know about the Dutch social security and how it applies to your specific situation.