The “customary wage” scheme in 2020

The “customary wage” scheme applies to any employee who is the holder of a substantial interest in the company that employs him or her. It tends to be the director-cum-controlling shareholder and the latter’s (life) partner to whom this applies. A minimum applies to the level of a director-cum-controlling shareholder’s wages, as follows:

• 75 percent of the wage earned in the more or most comparable employment or, if higher,
• the top wage earned by the private limited-liability company’s other employees or, if higher,
• 46,000 euros (up by 1,000 euros from last year’s minimum).

The company is at liberty to render it plausible that the director-cum-controlling shareholder should earn less than the amount as per the main rule. It is permissible for allowances to be made for discrepancies of up to 25 percent compared with the wage earned in the more or most comparable employment, on condition that the resultant wage should not drop below the 46,000 euro level.

A more lenient regime applies to directors-cum-controlling shareholders who operate in the innovative start-up sphere, in that these can apply the minimum wage or lower wage earned in the more of most comparable employment. In order for a business to qualify as an innovative start-up, it must

• have secured an R&D certificate whose validity extends to the entire year or to part thereof, and
• be entitled to the increased R&D start-up rate.

Dutch version: Gebruikelijk loon 2020