Temporary Emergency Measure of the Preservation of Jobs (NOW) in the Netherlands and foreign employers
To support companies in the Netherlands that are facing economic issues following the COVID-19 pandemic and to avoid mass unemployment, the Dutch government has implemented a series of economic measures. One of those measures is related to the compensation of employees’ wages, the so called Temporary Emergency Measure of the Preservation of Jobs (the NOW-ruling). Foreign employers with employees working in the Netherlands may be eligible for the compensation, but will face a number of specific issues.
Requirements for the NOW-ruling
All Dutch companies or foreign companies with a Dutch wage tax number can request the NOW-ruling. The ruling will be applied with the Dutch Employee Insurance Agency (UWV). Generally the following requirements must be met:
- the company must have a Dutch wage tax number;
- the company must choose a 3 month-period (March, April, May or April, May, June or May June July) for the payment of wages;
- the foreign company with a Dutch wage tax number or Dutch group of companies must have lost at least 20% of its revenue;
- a Dutch address;
- a Dutch bank account number is required for the payment.
Procedure of the NOW-ruling
If all requirements are met and the application has been filed, the UWV will make a decision within 4 weeks. The reimbursement of the wages depends on the percentage of the loss of turnover, up to a maximum of 90%. 80% of the amount will be paid as an advance in three installments. After the first decision, a second application will be required and the loss of revenue should be substantiated by an auditor’s opinion.
Several questions may arise when filing for the NOW-ruling:
- the group entities to include in the determination of the relevant revenue;
- the relevant period for comparison, especially when the calendar year is not equal to the financial year;
- the applicable accounting standards;
- what to do when a Dutch bank account number is not available.
Crowe Peak can help you to clarify the requirements and answer any questions that may come up. Many foreign companies with employees in the Netherlands do not have a Dutch bank account. It is really not clear why a Dutch bank account number is required, however, without a Dutch bank account number the NOW compensation will not be paid out.
If you are facing this problem or if you need guidance filling out the NOW-ruling application, please feel free to contact the experts at Crowe Peak.