What are substitution costs?

In your financial overview under Turnover taxes, you’ll see your substitution costs. These are the costs for having someone else cover your freelance shift. Remember, you’ll receive two invoices if you have yourself substituted for a shift.

VAT declaration

The VAT you pay on these costs can be deducted from the VAT you owe to the Tax Authorities, so it’s smart to include them in your VAT return. This is called tax reduction (in Dutch voorbelasting).

Example:

Let’s say you earned a total of €600 in a quarter. You received €126 VAT on that (€600 × 21% = €126). But you had one of your shifts covered by someone else. The substitution cost was €100 excluding VAT. You paid €21 VAT on that (€100 × 21% = €21).

The VAT you pay on business expenses can be deducted from the VAT you owe on your earnings.

When you file your VAT return, you enter this under “voorbelasting”. In this example, the amount you’d end up paying to the tax office is: €126 − €21 = €105.

By including the invoice from your substitute in your VAT return, you make sure you don’t pay too much tax. To make it easier for you, we’ve already included this in your overview.