30 Tax Ruling Netherlands
Are you eligible for the Dutch 30 % tax exemption? Duijn's Tax experts explain the rules of the Dutch 30 percent tax ruling for expats in the Netherlands.
You may have heard of the Netherlands 30 percent tax ruling available to foreign employees who move to the country – but do you know what the benefit actually is, and how it works?
Find out everything you need to know about claiming this 30 ruling tax exemption in the Netherlands:
- What is the Dutch 30 Percent Ruling?
- Conditions to Claim the 30 Percent Ruling
- Other Benefits Of 30 Percent Ruling
- Partial Non-Resident:
- Driving License:
- How long can you claim this tax exemption?
- Applying for the 30 percent ruling Netherlands
The 30 percent ruling is a tax exemption for foreign employees who were hired abroad to work in the Netherlands. If the conditions are met, the employer is allowed to pay the employee 30 percent of his or her salary as a tax-free allowance. This tax-free allowance is considered a compensation for the expenses the employee has by working outside his or her home country, but such expenses do not need to be substantiated.
Here is the list of the conditions that have to be met to be eligible for the Netherlands 30 percent ruling:
I. The employee has to work for an employer that withholds wage tax and is registered with the Dutch tax office.
II. The employee and the employer have to agree in writing that the 30 percent ruling is applicable. The 30% ruling application has to be carried out by both employee and employer.
III. The employee has to be recruited abroad by the employer or has to be transferred from abroad. The employee has to prove that he or she was residing abroad before coming to the Netherlands for the job.
IV. For the last 18 months out of 24 months at the time of hiring, the employee has not resided within 150 km from the Dutch border.
V. The employee is getting a gross annual salary of at least EUR 36.889 (the 30% excluded). Those who are younger than 30 years and have completed a master's degree, a lower salary of EUR 28.041 (the 30% excluded) per annum is applicable. Additionally, for doctors in training or employees in scientific education, no minimum salary is required.
VI. The employee needs to have skills or expertise that are scarcely available in the Netherlands. These skills can be determined based on numerous aspects including age, salary, education, employment history, and level of employment. However, in most cases your skills are ‘objectively’ measured only by salary. For some professions (like athletes) there are additional conditions.
On top of having 30 percent of your salary paid out tax-free, there are several other benefits of the 30 percent ruling:
Under the Netherlands 30 percent ruling you can choose for ‘partial non-residency status'. As a partial non-resident, you will not be paying the income tax on assets in Box 3 and 2 (most of your capital, excluding real estate in the Netherlands and considerable shareholding in a Dutch resident BV).
In most cases, even if you have a foreign driving license, you have to redo your test in to get a Dutch license. However, if you benefit from the 30 percent ruling in the Netherlands, it is possible to get a Dutch license by exchanging your foreign driving license without redoing the test.
The maximum duration of the Netherlands 30 percent ruling is 8 years. Time spent in the Netherlands over the last 25 years is included. The counting starts when you move to the Netherlands, not when you apply for the 30% ruling. So: apply as early as possible.
If you are an employee hired from abroad and bring specific expertise or a high enough salary to the Netherlands, then you might be eligible for the benefits of this special tax ruling.
Duijn's Tax Solutions experts can assess and request the 30% rule Netherlands for both employers and employees. Applying on time guarantees the employee and the employer to be able to apply the 30% ruling from the first working day. Duijn's Tax Solutions makes sure that requests are handled efficiently and quickly by cooperating with the Tax Authorities.
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