If your financial situation is such that you are unable to immediately pay a penalty due to circumstances such as the recent corona crisis, you may invoke diminished capacity. Capacity is defined as the total resources you have available to pay the penalty. If it is a matter of diminished capacity, the Netherlands Labour Authority may decide to mitigate the penalty.
In such an event, you must submit and substantiate the reasons for your capacity being insufficient. Please complete the questionnaire so that your capacity can be determined. You must send this questionnaire together with the documentary evidence set out below on this page in step 1 of the step-by-step plan. It is important that when completing this questionnaire, you provide the details of the financial situation over the past 3 years.
In addition, the outbreak of the corona virus and the corresponding measures led to a special situation. It is for that reason that when you fill in the questionnaire – with the information concerning the period covering 3 years – it is essential that you provide a financial substantiation in respect of the period of time in 2020 so far. You must also provide a substantiated prognosis from 1 June 2020 to 1 June 2021, which will then give a full picture of how the corona virus measures affected the financial situation of your company and which measures may possibly continue to have effects in future. Further to the information received, the Netherlands Labour Authority makes an assessment as to whether you will be offered a payment arrangement and/or whether the penalty will be mitigated.
The summary of the options
The following shows the options of a payment arrangement and a mitigation of the penalty as set out in a schedule.
In principle, a penalty is mitigated if:
- bankruptcy is inevitable, regardless of the penalty;
- you are already in a state of bankruptcy;
- you are in an amicable debt rescheduling arrangement.
Further to a review of proportionality, each case will be assessed individually to see whether a penalty is mitigated despite the circumstances referred to before. If you committed the same violation or a similar one (a repetition of the violation), a mitigation is in principle not granted and a payment arrangement is in principle no longer than three months.
Step-by-step plan
To make an assessment of your capacity, the Netherlands Labour Authority uses the following step-by-step plan.
Step 1: invoking diminished capacity and providing proof thereof
You must complete the questionnaire to determine your capacity which applies to your situation and send it in together with the necessary documentary evidence:
- Questionnaire to determine the capacity of a natural person
- Questionnaire to determine the capacity of a legal entity
Please note: The documentary evidence is subject to the terms and conditions set out in the questionnaire. If the documents do not meet the requirements, your claim of diminished capacity is not substantiated sufficiently as a result of which mitigation is not granted. However, in some cases, it is possible to give a payment arrangement. If you do not complete the questionnaire truthfully, the diminished capacity may not be assessed.
Step 2: assets
Your assets are considered first on the basis of the documents, with the exception of the dwelling (of a natural person) or the business premises (of a legal entity). It is not a matter of diminished capacity if the value of the assets is higher than the penalty. In such cases, it is not possible to mitigate the penalty and to make a long-term payment arrangement. However, it is possible to offer a short-term payment arrangement of three months which will give you the opportunity to release assets,
Step 3: the income
The income you receive will be considered if the assets as set out in step 2 do not suffice to pay the penalty. Income comprises wages, benefit payments, business profits and dividend. In the case of natural persons, only that part of the income is included which is over 100% of the statutory assistance criterion.
If the total of the assets and the income is higher than the amount of the penalty, the penalty is not mitigated. However, a long-term payment arrangement – no longer than 10 years – may be relevant, depending on the actual case concerned.
Step 4: the capital gain of a dwelling or business premises
If the total amount of the assets and the income do not suffice to pay the penalty, the possible capital gain on your dwelling or business premises is added to the capacity, which means that 75% of the capital gain is added to the assets and the income. If, after having been added together, it is sufficient to pay the penalty, the penalty will not be mitigated. However, a payment arrangement of no longer than ten years may be relevant.
Step 5: the penalty is higher than the capacity: a mitigation of the penalty and/or a payment arrangement
A penalty is mitigated if the total of the assets (step 2), the income (step 3) and the capital gain on the dwelling and/or on the business premises (step 4) are still not sufficient to be able to pay the penalty when spread out over several years. Depending on the amount of the penalty, it is mitigated to the total amount of the calculated capacity. In the process, a variable minimum is used and you are consequently allowed to pay this amount in instalments.
Such a payment arrangement has a maximum duration of 120 months or 10 years, depending on the individual circumstances, the amount of the penalty and the repayment capacity. The amount of repayment is calculated on the basis of the repayment capacity, but it is never lower than € 50 a month for natural persons and € 100 a month for legal entities. If it is not possible for you to pay these amounts, every financial setback will probably lead to bankruptcy. As set out above, in such cases, the penalty is not mitigated in principle.
Address
You can apply in writing for a payment arrangement and/or a mitigation of the penalty.
To apply for a payment arrangement, send the documents by way of email to: inningen@inspectieszw.nl or regular mail to:
Netherlands Labour Authority
Afdeling Boete, Dwangsom en Inning
Postbus 90801
2509 LV Den Haag
If you want to send in your application for a payment arrangement and/or a mitigation at the same time as your point of view or your notice of objection, then send your application to the address referred to in the letter you are responding to.
State our reference
Always state the reference number of the notification or the decision you have received which concerns the penalty. This number is on the first page of the letter, under ‘Our reference/Onze referentie’.
You will receive a reply as soon as possible stating whether you will be considered for a payment arrangement.
Any questions? Please contact us
If you have any questions about the payment arrangements and/or the capacity, please contact our Collection Team/Team Inning on our general telephone number 0800-5151.
If you have any general questions about the imposition of the penalty, please contact the person referred to in the letter sent to you.
Please note - Pay the penalty within the time limit imposed!
The fact that you have correspondence with the Netherlands Labour Authority or the CJIB after a penalty has been imposed, does not mean that the obligation to pay has been suspended. You must pay the penalty within the time limit imposed.