A man receives a substantial back payment from the UWV. The court concludes that, for tax purposes, the man received the back payment in 2020. This is because he only received the money in a single lump sum in that year and there had previously been uncertainty regarding his entitlement to the benefit. Under the law, the point at which wages are deemed to have been received is the moment of the back payment. The court cannot alter this situation, as this is a decision made by the legislator. The tax assessment is therefore correct.
Insufficient income tax
The court does, however, strongly suspect that the UWV withheld far too little payroll tax on the back payment. After all, it is highly unlikely that only €2,373 in payroll tax would be due on a gross salary of €30,638. The court therefore believes that something must have gone wrong behind the scenes at the UWV in one way or another. One possible explanation could be that, during the proceedings concerning entitlement to benefits, the UWV did in fact issue a payslip every month (or every four weeks), but consistently withheld the net amount shown at the bottom of that payslip pending the outcome of the proceedings. Once those proceedings were concluded, all the outstanding amounts were simply added together and the UWV paid out the total net amounts to the man. The total gross amounts and the total payroll tax deductions were then passed on to the Tax and Customs Administration. If that is correct, it would explain why the UWV withheld so little payroll tax.
Complaints and mediation
The court considers it going too far to take action itself against the UWV on this point, but the man could do so himself, for example by completing the complaints form. In doing so, he could enclose the court’s ruling, so that the UWV understands what the crux of the matter is. In addition, a request for mediation could lead to a refund for the man. This would then alleviate some of his hardship. The court sent the man’s documents to the inspector at the same time as the judgement, so that the inspector can consider the request for mediation whilst taking into account the information contained in the judgement.