North-east oil and gas firms and workers who operate in Dutch waters could start paying millions of pounds more in tax after changes to the country’s social security regime.
Authorities in the Netherlands have extended tax regulations to cover offshore workers operating in the Dutch sector of the North Sea, which could leave companies and their employees out of pocket.
The changes, introduced on January 1, mean anyone from the UK working in the Dutch North Sea faces social security contributions of up to £6,677, while businesses will have to pay up to £6,260 per person.
One union leader estimated that at least 200 UK offshore workers were on Dutch installations, meaning the combined contributions could amount to nearly £2.6million, but a north-east payroll firm said thousands of employees could be affected.
Aberdeen-based activpayroll urged Scottish oil and gas firms to make sure they comply with the new rules while negotiating exemptions where possible.
The company said Dutch authorities would “tighten the loopholes” around social security payments, and added employers and staff could end up making contributions in both the UK and the Netherlands.
Managing director Alison Sellar said: “This change will impact many north-east firms, they need to take proactive action to ensure they comply while working on the Dutch continental shelf or risk legal action.
“Although the industry has benefited from exemptions in the past, the Dutch authorities have clamped down, now demanding social security contributions from non-residents.”
Regional organiser of the RMT union, Jake Molloy, said at least 200 UK workers operated on Dutch installations and urged oil and gas firms to make sure their employees would not be left with a lower take-home pay just for working in a different region of the North Sea.
He said: “We would argue that if workers are being asked to work in different sectors, with a higher tax rate, then employers should do something about it.
“These guys are happy to work in pretty much any sector, but if they are transferred to areas with high tax regimes their potential earnings will be cut.
“If the respective tax agencies are not tackling it, the employers should be doing all they can to make sure they don’t find themselves in a situation where the workers are paying too much.”
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