For Agency Workers, One Sickness Date Can Alter the Tax Credit

The contract status behind a Ziektewet payment may matter more than the name on the payslip.

The income-tax return showed €4,008 in arbeidskorting. The tax inspector allowed €915. Between those figures sat a sickness notification, an agency contract and a benefit that looked connected to work but no longer counted as income from current employment.

That is a painful difference to discover through a tax assessment. The worker had earned wages, reported sick, received a Ziektewet benefit and later returned to the same agency. From an ordinary human perspective, the work relationship may have appeared interrupted rather than broken. Tax law followed the sequence of contracts and dates more precisely.

The Gelderland District Court ruled on 2 September 2026 that the benefit did not qualify for the employment tax credit. Under the agreement before the court, the first sickness notification ended the agency employment. When the worker returned, the court treated that return as a new contract. A second sickness notification ended that relationship too.

The date does the tax work

The arbeidskorting is calculated from qualifying employment income. Since 1 January 2020, a Ziektewet benefit received after the employment relationship has ended generally falls outside that income category. The fact that the payment follows a period of work does not preserve its tax character.

The precise tax-file question is whether an employment relationship still existed when the worker received the Ziektewet benefit. That question is narrower than whether the person still felt connected to the agency. It is also narrower than whether the same agency later offered more work.

In this case, recorded as ECLI:NL:RBGEL:2026:6778, the later return did not revive the first contract. It created another one under the same conditions. The contract clause, sickness notification and employment end date determined the treatment of the later payment.

The ruling was a first-instance decision and remained open to appeal within the applicable period. Its practical value lies in the court’s reading of the documented sequence. A contract clause can have a direct tax consequence when sickness changes the employment relationship.

Not every sick agency worker follows this route. UWV explains that an agency contract may end during sickness when an uitzendbeding applies, the client ends the assignment and the agency invokes the clause. Different rules apply to agencies affiliated with ABU or NBBU. In those cases, UWV states that the contract cannot be ended during sickness and that the agency remains responsible for wages and reintegration until the contractual end date.

The label “sick agency worker” therefore tells us too little. The contract, collective arrangements and actual decisions tell us much more.

A wider payroll change is approaching

The court case concerned a 2022 income-tax return. The more current signal comes from the Belastingdienst and takes effect on 1 January 2027.

From that date, employers may no longer apply arbeidskorting through payroll to several specified benefits paid alongside wages or an employer supplement. The list includes Ziektewet benefits that do not arise from the current employment relationship, together with several incapacity benefits. A benefit paid directly by UWV is outside this particular payroll change.

I read this as a firmer separation between pay for current work and benefit income that merely passes through an employer. The payment channel will carry less weight than the nature of the payment.

For workers, the difference can be material. In 2026, the arbeidskorting for someone below AOW age can reach €5,685 before it begins to taper above €45,592 of employment income. Those figures should not be applied retrospectively to the 2022 court case, but they show why classification matters.

Payroll deductions also remain provisional in practice. An employer applies the credit during the year, while the Belastingdienst determines final entitlement through the annual income-tax assessment. A payslip can create one expectation and the assessment another.

That gap is where employee questions, correction work and damaged trust tend to appear. The business may not owe the worker’s personal tax, yet it may still need to explain why the payment was coded as it was.

What the small business can control

Consider a small warehouse using agency staff. The client tells the agency that a placement will end. Around the same time, the worker reports sick. The agency then has to determine whether employment continues, whether a contractual clause applies, who pays, who reports the sickness to UWV and how the payment enters payroll.

Months later, those separate actions must still describe the same event. If the client’s email shows one end date, the agency contract another and payroll a third, the tax treatment becomes harder to explain. Familiarity with the worker cannot repair an unclear timeline.

The client business does not control the agency’s payroll, but it does control its own communication. A roster change, assignment ending or later request to re-engage someone should be recorded clearly. For the agency and payroll provider, the distinction between continued wages, a benefit during employment and a benefit after employment needs to survive handovers between operations, absence administration and payroll.

I would want a sample sickness case to be readable from beginning to end without oral reconstruction. The signed agreement, assignment status, sickness date, contractual decision, UWV report, payment record and any later placement should agree. That is not paperwork for its own sake. It is how a business prevents one operational event from producing several incompatible tax stories.

The worker at the start of this column did not lose a tax credit because sickness was considered less real. The outcome followed from the status of the employment relationship when the benefit was received.

Seen only on an assessment, that distinction can feel severe. Seen earlier, at the moment the contract, sickness report and payroll entry meet, it is manageable. The calm response is to make that moment visible and record it well.

The data, sourcing, and analysis behind this article were conducted by Linda Pavan Geraedts. AI was not used to identify sources, build the factual basis, or produce the analytical judgment contained here. AI was used only as a drafting aid. The final English text was personally reviewed, edited, and approved by Linda Pavan Geraedts before publication.

References

• Geen arbeidskorting over ziektewetuitkering na einde dienstverband - Taxence
• Rechtspraak - Court ruling on Ziektewet benefits after termination of an agency contract
• UWV - Operational boundary for sick agency workers and Ziektewet applications
• Belastingdienst - Current 2026 employment-tax-credit scale
• Belastingdienst - 2027 removal of payroll employment-tax-credit treatment for certain benefits
• Rijksoverheid - Policy basis for equalising employer-paid and UWV-paid incapacity benefits
• Belastingdienst - Income qualifying for the employment tax credit