Expat Tax in the Netherlands
The Dutch tax system can be anything but simple, especially if you are an expat. And dealing with the tax authorities (Belastingdienst) is best left up to the professionals.
The Netherlands is a socially conscious country, which means a substantial proportion (up to 52 percent) of your salary can end up going to the taxman. But your personal situation (non-working partner, for example), type of work, residency status and other assets and earnings (particularly from abroad) can affect your expat tax position considerably.
The Dutch 30% ruling for expats
Many expats have more expenses than Dutch employees. For instance, they might still have housing expenses back home, as well as in in the Netherlands. Dutch legislators have recognized this and have devised a special scheme to attract expats, particularly those with skills that are in short supply in the Netherlands, by introducing the so-called 30% rule. That means, more specifically, that 30% of your gross salary is tax-free.
Who is eligible for the 30% rule?
A number of criteria have to be met to be eligible for this exemption. They include:
- employee works for an employer who is registered with the Dutch tax office and pays payroll tax;
- employee must have transferred from abroad or be recruited abroad;
- employee must have expertise that is not readily available in the Netherlands;
- and a certain salary is required
Less strict rules apply for PhD and Master’s graduates younger than 30 years:
- the minimum salary requirement is EUR 28,125 taxable.
- if the PhD was completed in the Netherlands, the requirement of ‘being recruited from abroad’ does not have to be met if the candidate is hired within a year of completing his or her studies.
How to apply for the 30% ruling?
To apply for this 30% ruling for expats, you should file a request with the Belastingdienst. However, filling in this request is best done by a professional, as it gets pretty tricky really quickly.
We recommend you to make this request within four months after your employment has commenced, as the 30% ruling will still have retroactive effect to the start of the employment. If you file this request later, the ruling will apply from the next month onward.
Keep in mind that the 30% ruling applies for a period of 5 years.
Other tax matters for expats:
For expats, rebates may be available in the year of arrival or departure, particularly if you have not completed a full tax year. Expats living in Amsterdam will often have to pay extra tax on their property, which goes towards city improvements. So, making sure you speak to someone who knows all these ins and outs is definitely going to be worthwhile.
Want to know more?
To make sure you don’t end up paying more tax than needed as an expat, call us on + 31 70 5118788 or complete the contact form. We’re here to help!
How can we help you?
José de Boer
If you own a property in the Netherlands and you use it as your main residence, then you may be able to claim some tax deductions.
These deductions can be claimed in your tax return if you are taxable in The Netherlands.
You can also claim a provisional monthly refund. This has to be done every year again. The costs can be divided in one time only costs and annual costs.
One time only costs which are tax deductible (costs related to the financing/mortgage)
- The mortgage contract (Hypotheekakte)
- Valuation costs (Taxatierapport)
- Mortgage arrangement cost (Hypotheekadvies by FVB De Boer )
- Costs related to the National Mortgage Guarantee (NHG)
- Fine which has to be paid because of early repayment of the old mortgage (when you decide to change mortgage provider)
Annual costs which are tax deductible
- Interest payments on your mortgage (Tax deductible for maximum 30 years)
- So called ‘erfpacht’ payments
Not deductible (costs related to the property itself)
- Transfer tax (Overdrachtsbelasting)
- Transfer contract (De leveringsakte)
- Restate agent fee (Makelaarscourtage) – not mandatory
- Technical report (bouwkundigrapport) – not mandatory
- Additional Costs (Kosten Koper)
- Reimbursing current owner for housing taxes (rioolrecht, OZB, Afvalstoffenheffing)
- Costs of maintenance and renovation
- Repayments of the mortgage
No this is not possible.
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