Hiring in-house or nearshore: what a developer costs per month

An employed developer costs a lot more per month than their gross salary, once you add holiday pay, employer contributions, pension, equipment and recruiting. A freelancer costs more per hour but nothing in the weeks they do not work. Through us, a nearshore developer costs from €4,800 per month, all-in. My advice is to put the total monthly cost of each option side by side, because a salary next to an hourly rate tells you very little.

I calculate with the Dutch rules and rates for 2026. In Germany or Belgium the cost items look similar, but ask your payroll provider for the local numbers.

What comes on top of gross salary

Dutch employees are entitled to at least 8% holiday allowance. On top of that, the employer pays contributions on wages. In 2026 these are the main ones:

• unemployment insurance: 2.74% for a written permanent contract that is not an on-call contract, 7.74% otherwise
• disability insurance: 6.27% or 7.63% depending on the size of your company, plus a 0.50% surcharge for childcare
• the employer's health insurance levy: 6.10%
• a return-to-work premium that differs per employer

These apply to wages up to €79,409 a year. On a permanent contract at a small company, they add just over 15.5% to wages including holiday pay. The return-to-work premium comes on top.

If you offer a pension scheme, or a collective agreement requires one, you pay the employer's share. Then there are a laptop, tool licences, a desk, training and travel costs. Each item is modest on its own, but together they add up.

Costs that show up later

Recruiting costs money or time: an agency fee, or hours of your team's time on job ads, interviews and technical assignments. You lose those hours even if you hire nobody.

For a small company I think sick leave is the largest financial risk. In the Netherlands you keep paying a sick employee for up to two years, at least 70% of wages in both years. You can insure against it, but the insurance costs money too.

Parting ways costs money as well. A dismissed Dutch employee is entitled to a transition payment of one third of their gross monthly wage per year worked, and during the notice period you keep paying salary.

Ramp-up time applies to all three options. A new developer delivers less in the first weeks, wherever they come from.

A freelancer costs more per hour and less in fixed costs

With a freelancer you pay for hours worked. Holiday pay, contributions and income during illness come out of their hourly rate. When the freelancer leaves, the knowledge leaves too, unless it was written down.

Watch out for false self-employment. The Dutch tax authority resumed full enforcement on 1 January 2025. If a freelancer in practice works as an employee, it can impose additional payroll tax assessments on you as the client, and since 1 January 2026 it can add a penalty for misconduct. A freelancer who sits full-time in your team for years, under your direction, quickly looks like an employee. Check the rules in your own country too.

For a defined piece of work with a clear end, a freelancer is often a good choice, for a permanent seat in your team less so.

What nearshore through us costs

A full-time developer through us costs from €4,800 per month, all-in. That covers recruitment, the workstation, a managed and encrypted laptop, accounts with SSO and two-factor authentication, and the admin. Part-time is possible by arrangement. Book a call and we will work out what your roles cost.

You choose who joins your team. The first two weeks are a trial: if it does not work out, you pay nothing. After that the contract runs per month, and you scale up or down monthly. The developer is not your employee, so scaling down does not cost you a transition payment.

What you still pay for is your own time. Someone on your side has to onboard the developer, prepare work and review code, just as with a colleague in the office. How we handle the rest is described under how we work.

The three options side by side

How to calculate it for your own case

1. Take the gross salary you want to offer and add 8% holiday allowance.
2. Add the employer contributions, including your own return-to-work rate.
3. Add pension, laptop, licences, desk and training.
4. Spread the recruitment cost over the time you expect the person to stay.
5. Divide the yearly total by the months someone actually works, after holidays, public holidays and sick days.

A worked example with a round number: you offer €5,000 gross per month on a permanent contract at a small Dutch company. Holiday allowance comes to €400 per month. On that €5,400 you pay 15.61% in contributions, about €843. That brings you to roughly €6,240 per month. The return-to-work premium, pension, laptop and recruitment come on top, plus the months someone is ill or on holiday.

Set that against a freelancer's hourly rate times the hours you need, and against the monthly nearshore price. Then you compare like with like.

When hiring in-house is the better choice

Sometimes an employed developer is the right call, for example for your first core technical hire, who will carry the architecture for years, or for someone who has to be on site every day. If nobody on your side can divide work and review code, a remote developer will not help yet. I wrote about that separately in when a remote team does not work.

Time zone is part of the cost too, because a low rate far away can cost you more in waiting time than it saves. Maarten explains why time zone matters more than rate. Serbia is in the same time zone as the Netherlands, so with us that does not come into play.

Sources

• business.gov.nl: holiday allowance
• business.gov.nl: sick pay
• business.gov.nl: transition payment after dismissal
• Belastingdienst: payroll tax rates 2026 (pdf, Dutch)
• Belastingdienst: low and high unemployment premium (Dutch)
• Belastingdienst: employment relationships and enforcement (Dutch)