More and more directors and entrepreneurs work through a personal holding company. Useful for tax planning, structuring, and risk management. But beware: a holding structure does not automatically prevent an employment relationship.
A recent ruling by the Court of Appeal Arnhem-Leeuwarden confirms once again that if you work under factual authority, you can still be treated as an employee, even if the payments run through your holding.
The Case: Invoicing Through a Holding, but Running the Company in Reality
In this case, a director had been working since 2013 via his personal holding for a company in which he held a 30% share.
In 2018 the structure was adjusted:
- a new joint holding company was incorporated;
- this joint holding became the formal director of the operating company;
- the man started invoicing through his personal holding;
- he was no longer registered as an employee.
Yet he continued to run the daily operations of the business.
Court of Appeal: the Elements of an Employment Relationship Were Still Present
The Court ruled that, despite inserting another company in between, there was still a private-law employment relationship under Article 7:610 of the Dutch Civil Code. The key points:
- Personal work: the director performed the activities himself.
- Wages: he received remuneration, even if via his holding.
- Authority: the general meeting of shareholders could instruct him.
Together, these elements mean the director must be treated as an employee for tax and social security purposes.
Critically, neither the management agreement, nor invoicing via his holding, nor any amendments to the articles of association changed the factual reality.
No Decisive Control = No Director-Major Shareholder Exception
The director had no decisive control, and therefore could not rely on the exception provided by the 2016 Director-Major Shareholder Regulation.
Result: mandatory social insurance coverage and legitimate additional payroll tax assessments for 2018–2020.
Why This Matters for Entrepreneurs and Directors
This ruling reinforces a fundamental truth: the tax authorities look at what you actually do, not at how the paperwork is arranged.
Working through a holding, but lacking decisive control while effectively managing the company?
Then the tax authority may still qualify your position as employment.
The risk: substantial assessments, corrections, and insurance premiums.
XTROVERSO Conclusion
- Working through a holding does not rule out employment.
- No decisive control? You’re fiscally considered an employee very quickly.
- The Dutch Tax Authority looks at practice, not invoices.
- Review your structure before costly problems arise.
Conclusion
A VAT number and a Chamber of Commerce registration do not automatically qualify someone as an entrepreneur for income tax purposes. Anyone claiming entrepreneurial deductions must meet the strict legal requirements. The Hague Court confirms that the tax authorities are right to assess this critically.
