When you employ 1 or more employees then you must keep payroll records. These payroll records must meet specific conditions, in part to ensure that you can submit the correct information to the Tax and Customs Administration. Show
You may exercise your discretion in deciding the state in which you will keep your payroll records, unless you are a voluntary withholding agent: you must then keep payroll records in the Netherlands. When you keep your payroll records in a state other than the Netherlands you must nevertheless offer the Tax and Customs Administration an opportunity to inspect your payroll records in the Netherlands. Information you require for your payroll recordsThe Tax and Customs Administration assists you in the creation of your payroll records by sending some of the information you will need to you by post. This information includes:
Keeping up-to-date wage statementsYou create an annual wage statement for each employee before the payment of the first wages in that year. You keep up-to-date records of the employee and the employee's wages in the wage statement, including the employee's personal details, the application of the payroll tax reduction and the number of the income relationship. When you use payroll records software the software will create the wage statements. You will need to provide for these wage statements if your payroll records are not fully automated or you do not contract out your payroll records. A model wage statement can be downloaded here (only available in Dutch). You may also use your own model for the wage statements, provided that the statements include at least the same information. The wage statement consists of 2 parts:
Automated payroll recordsWhen you make use of automated payroll records then you must make records of all the employee data and make sure that these data can be furnished in the form of a complete wage statement at any required time. Retention of secondment certificatesHave you seconded an employee to the Netherlands and does this employee live in another state? If so, the Tax and Customs Administration recommends that you make a copy of the original secondment certificate. This, with secondment within the EEA, is usually an A1/E101 certificate. The secondment certificate is issued by the social security authority of the state in which your employee is insured. Payroll records auditsThe Tax and Customs Administration must be able to audit your payroll records. Some schemes are governed by specific administrative obligations. You must also take account of the retention periods. More information can be obtained by calling the Tax Information Line. Per the IRS, Employers are required to keep all tax records for at least four years after filing the 4th quarter for the year and should be made available for IRS to review. The list below is directly from the IRS site for Employers to know what their tax records should include for record keeping.
What records need to be kept for 7 years?Keep records for 7 years if you file a claim for a loss from worthless securities or bad debt deduction. Keep records for 6 years if you do not report income that you should report, and it is more than 25% of the gross income shown on your return. Keep records indefinitely if you do not file a return.
Which forms should employers retain for at least four years?Keep all records of employment taxes for at least four years after filing the 4th quarter for the year.
How long do most employers keep employee records?EEOC Regulations require that employers keep all personnel or employment records for one year. If an employee is involuntarily terminated, his/her personnel records must be retained for one year from the date of termination.
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