How we helped a foreign taxpayer open a G account in the Netherlands

The client’s problem

One of our non-Dutch clients is engaged as a sub-contractor in a construction project in the Netherlands. For that purpose, the client seconded staff from abroad to the Netherlands. In the case at hand, our client is due Dutch payroll tax and Dutch VAT.

If the payroll taxes would not be paid by our client, the Dutch tax authorities can hold the main contractor liable. The main contractor limits his risk of liability by depositing the estimated amount of payroll taxes into a blocked bank account of the sub-contractor, also known as a G account.

A G account can only be used to pay payroll taxes and/or VAT to the Dutch tax authorities.

The foreign taxpayer (our client) was not able to open a Dutch bank account, and therefore it was not possible to open a G account.

Our solution

The first thing we did was helping our client establish a Dutch limited liability company. Subsequently it was able to open a Dutch bank account.After opening this Dutch bank account, we prepared and completed the application for the G account. As time went by, we also asked the Dutch tax authorities to issue a declaration of good payment behavior; which they did.

Current situation

The commercial impact of a G account and declaration of good payment behavior in combination with a Dutch limited liability company, should not be underestimated. Our client can now easily demonstrate its main contractors that it is trustworthy constructor. Hence it was able to gain new projects in the Netherlands.

Note: due to the privacy of our clients, this case study provided by TGS lime tree does not include any names, numbers and other sensitive information of our clients, partners and other parties involved.