Chain Liability Act (WKA)

Dutch Tax and Customs Administration

This algorithm helps employees of the Inland Revenue handle applications for a WKA declaration.

Last change on 25th of June 2024, at 18:20 (CET) | Publication Standard 1.0

• Publication category: Impactful algorithms
• Impact assessment: Field not filled in.
• Status: In use

General information

Theme

Public finance

Begin date

Field not filled in.

Contact information

[e-mail]

Link to publication website

https://over-ons.belastingdienst.nl/onderwerpen/omgaan-met-gegevens/algoritmeregister/

Link to source registration

https://over-ons.belastingdienst.nl/onderwerpen/omgaan-met-gegevens/algoritmeregister/wet-keten-aansprakelijkheid-wka/

Responsible use

Goal and impact

The Chain Liability Act (WKA) was created to give contractors in a chain of contractors and subcontractors more certainty that they are working with reliable subcontractors. Contractors can demand a so-called WKA declaration from subcontractors. The relevant subcontractor or hirer (entrepreneur hiring staff from another company) can apply for this from the Tax and Customs Administration. A so-called 'clean' WKA statement is issued if the subcontractor or hirer has no outstanding claims with the Tax Authorities and if declarations have been submitted on time and in full. If this is not the case, a so-called 'reserve declaration' can be issued in certain cases. A WKA declaration is valid for three months. A subcontractor must therefore reapply for it every quarter.

Given the large number of applications, the Tax and Customs Administration staff are supported by an algorithm in handling the applications.

Considerations

The algorithm helps determine whether a WKA declaration can be issued by checking the entrepreneur's declaration and payment details. The algorithm gives each application a signal. This signal indicates whether the declaration can be issued without further verification or whether it needs to be manually assessed first. Thus, the algorithm makes the process more efficient and effective.

Human intervention

Applications that the algorithm indicates can be issued without further verification are then issued automatically. Other applications are then manually assessed by a staff member.

Risk management

The algorithm was developed by the Tax Administration and is also maintained internally. For the development of algorithms, the Tax and Customs Administration has drawn up conditions, a quality framework. This contains rules and agreements that are followed when developing the algorithm. The conditions of the Audit Service Rijk (ADR) are leading in this respect. When changes are made to the algorithm, the Tax and Customs Administration checks whether the algorithm still meets the quality requirements.

The use of the data is tested against the General Data Protection Regulation (AVG). The Tax Authority prevents direct discrimination with the algorithm by not using protected personal data, such as ethnic origin. The AVG prescribes that we cannot use more data than necessary. This is called data minimisation. The Inland Revenue regularly examines whether the data used is still necessary and therefore may be used. If this is not the case, the algorithm is adjusted and this data is also no longer used.

The algorithm divides the applications into a number of groups. This grouping is only used in the process described. Outside of this, they are not used, to avoid profiling that is not allowed.

Legal basis

General State Tax Act

Collection Act 1990

Collection Guidelines 2008

Implementation rules for recipients', chain and principal's liability 2004

Turnover Tax Act 1968

Wage Tax Act

Links to legal bases

• Algemene wet inzake rijksbelastingen: https://wetten.overheid.nl/BWBR0002320/
• Invorderingswet 1990: https://wetten.overheid.nl/BWBR0004770/
• Leidraad Invordering 2008: https://wetten.overheid.nl/BWBR0024096/
• Uitvoeringsregeling inleners-, keten- en opdrachtgeversaansprakelijkheid 2004: https://wetten.overheid.nl/BWBR0016131/
• Wet op de Omzetbelasting 1968: https://wetten.overheid.nl/BWBR0002629/
• Wet op de Loonheffing : https://wetten.overheid.nl/BWBR0002471/

Operations

Data

• Identifying data (BSN)
• General data entrepreneur
• Claim and payment details
• Turnover tax (OB) return details
• Wage tax return details (LH)
• Tax audit data

Links to data sources

• Identificerende gegevens (BSN): Basisregistratie Personen (BRP)
• Algemene gegevens ondernemer: Kamer van Koophandel (KvK)
• Vorderings- en betalingsgegevens: Belastingdienst
• Aangiftegegevens Omzetbelasting (OB): Belastingdienst
• Aangiftegegevens Loonbelasting (LH): Belastingdienst
• Gegevens boekenonderzoek: Belastingdienst

Technical design

The algorithm consists of decision rules created in cooperation with content experts based on the relevant law. Based on the decision rules, the algorithm gives a signal to the Inland Revenue employee for each application. Applications that the algorithm indicates can be issued without further verification are then issued automatically. Other applications are then manually assessed by an employee.

The algorithm is not self-learning. This means that it does not evolve while being used.