June 30, 2025
What you need to know about false self-employment as a freelancer or client
Since January 1, 2025, the Dutch Tax Administration has been actively enforcing rules against false self-employment. Are you working as a freelancer or hiring freelancers? Then it’s important to understand what false self-employment means, the associated risks, and how to avoid it. In this article, we explain everything about the characteristics of false self-employment, the DBA Act, the risks, the tax authority’s control approach, and the criteria used to assess employment relationships.
What is false self-employment?
False self-employment means someone works as a freelancer but actually performs the same work as a regular employee. However, that person does not receive the rights and security of a regular job. The client also avoids paying taxes and social security contributions, which would be required for an employee.
Characteristics of false self-employment:
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Instructions and rules: the freelancer follows instructions similar to those of an employee.
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Fixed working hours: little to no freedom to decide when and where to work.
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Economic dependence: the freelancer relies heavily on one client for income.
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Use of client’s resources: such as office space, equipment, or company tools.
False self-employment leads to unfair situations. Freelancers may receive benefits or disadvantages they shouldn’t, and clients avoid regulations and costs they would face with employees.
The DBA Act: what does it entail?
The DBA Act (Assessment of Employment Relationships Deregulation Act) aims to prevent false self-employment. It helps determine whether someone is truly self-employed or actually working as an employee. Clients and freelancers can use a model agreement, a sample contract approved by the Dutch Tax Administration. This agreement is intended to show that the freelancer is genuinely independent and not an employee.
Note: using such a model agreement does not offer full certainty. The Tax Administration primarily looks at how the collaboration works in practice. If it turns out to resemble an employment relationship, taxes and penalties can still be imposed.
Risks of false self-employment
For freelancers:
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Tax corrections: the Tax Administration may revoke tax benefits such as the self-employment deduction, startup deduction, and SME profit exemption.
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Additional assessments and fines: you may face high extra costs.
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Outstanding premiums: you might still have to pay employee insurance contributions.
For clients:
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Payroll tax assessments: if the person is deemed an employee, the client may still have to pay payroll taxes and social premiums.
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Fines and retroactive costs: if the Tax Administration finds deliberate misclassification, fines can be imposed and costs from January 1, 2025, onward must be paid retroactively.
How does the Tax Administration check?
Starting in 2025, the Tax Administration will actively conduct inspections to prevent false self-employment. First, they select companies with a higher risk of misclassification, based on data and reports from other authorities. Then, they may visit those companies for a discussion about their use of freelancers to raise awareness of the risks.
After the visit, companies usually get three months to make improvements. This is the “soft landing” phase, where a warning is given first without immediate penalties. If no action is taken, the Tax Administration launches a formal audit. This includes a thorough investigation of records and freelancer collaborations. From that point on, warnings are no longer issued.
When false self-employment is found, the Tax Administration only looks at employment relationships from January 1, 2025, unless fraud is suspected. Companies that actively work on properly assessing working relationships won’t receive fines in 2025 but must still pay payroll taxes and premiums. From 2026, enforcement becomes stricter and can go back up to five years. The mild enforcement policy of 2025 is therefore temporary.
How does the Tax Administration assess employment relationships?
The Tax Administration focuses mainly on three key points and nine additional factors from the Deliveroo ruling. Since 2025, “external entrepreneurship” has also become an important element.
The three main criteria:
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Authority:
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Does the freelancer have to follow the client’s instructions?
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Does the client decide where, when, and how the work is done?
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Work:
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Is the freelancer allowed to send a substitute?
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Wages:
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Does the freelancer receive the same payment regardless of whether the work is finished?
The nine assessment factors (Deliveroo ruling):
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Nature and duration of the work: simple and long-term work often suggests an employment relationship. Also important: is there a duty of effort (no guaranteed result) or an obligation to deliver results?
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Determination of tasks and working hours: limited freedom in how, when, and where to work points to employment.
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Integration into the organization: do you work with employees and follow the same rules? This resembles employment.
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Personal obligation to work: are you required to do the work yourself, or may someone else do it?
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Formation of the agreement: did you have room to negotiate the terms? Less room means a higher chance of employment status.
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Remuneration: can you set your own rate and payment method? If your pay resembles that of employees, it often suggests an employment relationship.
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Amount of remuneration: do you earn about the same as employees? That points to an employment relationship.
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Commercial risk: do you bear risks, for example when sick or covering expenses? Less risk means higher chance of employment status.
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Entrepreneurship: do you have multiple clients and invest in your own name? Less entrepreneurship points to employment.
External entrepreneurship
As of February 2025, the Tax Administration places strong emphasis on external entrepreneurship when determining whether someone is a freelancer or employee. This means freelancers must show they are truly independent entrepreneurs by:
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having multiple clients
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being registered with the Chamber of Commerce
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investing in their business
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bearing entrepreneurial risks, such as non-payment
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using their own website, logo, or branding
As a client, you are responsible for verifying and documenting whether your freelancer is truly independent. You can do this by:
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asking targeted questions at the start of the collaboration
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clearly documenting responsibilities and tasks
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collecting evidence that proves the freelancer’s entrepreneurship
Even if the freelancer works through an intermediary, the Tax Administration assesses the full picture of external entrepreneurship. So make sure everything is in order to avoid future issues.
How to prevent false self-employment
To prevent false self-employment, it’s important for clients to thoroughly check whether a freelancer is truly self-employed. Pay attention to factors like multiple clients, Chamber of Commerce registration, entrepreneurial risk, and investments. Make clear agreements about responsibilities, ask specific questions at the start, and keep evidence of entrepreneurship. Use model agreements and document everything in writing. Avoid having the freelancer become too embedded in your organization, and ensure they control how the work is done. The Tax Administration’s check can also help you understand how to correctly classify the employment relationship. The new labour market reform law (WAB), planned to take effect on January 1, 2026, is intended to provide more clarity on when someone qualifies as an entrepreneur or should be considered an employee.
