Multi-state workers: salary split

Salary split

If you are a director/majority shareholder (Dutch acronym: DGA), a multi-state worker or an employer of multi-state workers, you or your employees may well be liable to payroll tax in multiple countries. This is referred to as a salary split. We will explain this below.

Salary split to prevent double taxation

Many countries claim the right to tax the worldwide income of their residents. Multi-state workers may be subject to tax on the same income in multiple countries.

The Netherlands has signed a large number of tax treaties for the prevention of double taxation, so that employees only pay income tax on the same income once. The rule of thumb in these tax treaties is that the country in which the work is carried out is competent to levy tax on the income earned there. If a person works 260 days in one year, 130 of which are spent working in a country other than the Netherlands, 50% (i.e. 130/260) of their income will normally be taxable in that country. In other words, a salary split is not a choice, it is a statutory requirement.


Some exceptions apply, one of which is the 183-day rule. In short, for a company based in the Netherlands, this means that, if one of its employees works outside the Netherlands for fewer than 183 days per year and the business/employer is not based or has an office/branch outside the Netherlands, all of the employee’s salary will still be taxable in the Netherlands. There are exceptions to this rule as well. They apply, for instance, to people who work on ships or aircraft, or to employees hired through an employment agency.


As a business owner or employer, it is not very efficient to keep payroll accounts in multiple countries. That said, the fact that you or your employees are liable to tax in multiple countries can also be beneficial. Many countries use a progressive tax rate, meaning that the tax rate increases as a person’s income rises.

In the Netherlands, for instance, the income tax rate for residents with an income of € 30,000 (gross) has been capped at 37.1%, while the tax rate for residents whose income is € 75,000 (gross) is 49.5%. Anyone liable to tax in two countries tends to be subject to the low tax rate in both countries, so that, overall, their net income rises.  

Setting up a salary split for your organisation

Please do not hesitate to contact your international adviser at acconavm or our international employer service by sending an email to if you believe that a salary split may have to be set up for you or your employees. Also, it is very important that you document meticulously how many days you or your employees spend working abroad. We can use this information to decide whether a salary split needs to be set up for your organisation and advise you on how to implement it.

International payroll accounting in your own language

We offer an international employer service with a payroll accounting system that has been structured in such a way that it can handle a salary split based on the information you provide. The online payroll accounting system is available in English and German. It goes without saying that our people would be happy to answer any questions you may have. They are fluent in English and in German. Please feel free to send an email to or call Sander Kant on +31 (0)884 467 776.

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