Court urges fix for tax bills after benefit back-payments

The district court in Groningen has called on benefit agencies and the legislator to solve a problem with back-payments of benefits. People who receive a back-payment from one agency can later be billed by the Belastingdienst, the tax authority, to pay part of it back.

The call follows a case brought by a woman who got a back-payment from the UWV and then received a bill of hundreds of euros from the tax authority. It issued a tax demand (naheffing) because the UWV had withheld too little payroll tax (loonheffing).

The court ruled that the tax authority was within its rights. It should still have decided differently, the court said, given the large impact on the woman: for many people on a benefit every euro counts, and the tax authority could also have collected the assessment from the UWV.

The court says similar cases happen regularly: people receive too much from one agency and later have to repay it to the tax authority. "The court considers that undesirable," it said, and it calls on the implementing agencies and lawmakers to solve the problem.