Dutch 30% ruling: Requirements, conditions, and applications

Did you know that with the Dutch 30% ruling, you can get part of your salary tax-free? Learn more about the ruling, eligibility criteria, and how to apply.

Ivandzhelin

4 minute read
·
21 Jun 2024
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Do you need to relocate to the Netherlands because you’ve been offered a job? Then, you might be eligible for the Dutch 30% ruling. It’s a tax benefit allowing highly skilled foreign employees to receive 30% of their gross salary in the Netherlands tax-free. Read on to learn what makes you eligible, how to apply, and how much the 30% ruling in the Netherlands is.

What is the 30% rule in the Netherlands in 2024?

The 30% ruling is a tax benefit that allows highly skilled and educated foreign employees to receive 30% of their gross annual salary in the Netherlands tax-free.

The ruling helps people moving from abroad to accommodate the costs of living in the Netherlands. These can include:

  • Travel costs to come to the Netherlands or visit your family in your home country
  • Medical exams or vaccines needed to relocate to the Netherlands
  • Initial or double housing costs if you need to commute to the Netherlands
  • Costs of the Dutch language courses you might need to take
  • Cost of living in the Netherlands
  • Storage costs for the belongings you aren’t bringing to the Netherlands

When signing your employment contract, you and your employer agree that you’ll receive 30% of your gross annual salary as a benefit from the Dutch government. So, if your annual salary is €100,000, your employer will pay you €70,000, and the rest €30,000 you’ll receive tax-free.

Another perk of receiving the Dutch 30% ruling is that you and your (fiscal) partner are exempt from paying taxes in Box 2 (tax on substantial interests, e.g., you own over 5% of a company) and Box 3 (taxes on investments and savings).

Keep in mind that the 30% ruling has some drawbacks as well. As you agree to a lower salary from your employer, your healthcare, pension, and unemployment benefits will be lower. This is because your employer pays lower taxes for you, and Dutch taxes are used to cover your social benefits.

Who is eligible for the 30% ruling in the Netherlands?

Foreign employees relocating for a Netherlands-based job with an annual gross salary above €46,170 are eligible for the 30% ruling in the Netherlands. Aside from this, there are also a few more requirements for the ruling:

  • You’re employed by a company based in the Netherlands (see more below)
  • You have a written agreement with your employer which states that you both agree that you’ll receive the 30% ruling
  • You earn at least €46,170 per year if you’re over 30 and €35,048 annually if you’re under 30 and hold a Dutch master’s degree.
  • You lived at least 150km from the Dutch border before being employed by the company in question in the last 16 to 24 months. (see more below)
  • You’re a highly skilled employee with skills not available in the Netherlands.
  • Your employer has to be registered with the Dutch tax authorities (Belastingdienst)

You can prove employment with a Dutch company either by having an already-signed employment agreement or a series of documented exchanges proving that you’ve been offered the position and are in the process of signing a contract. For example, you’ve received an email and proposal letter from the company informing you that you’ve received the job and that you’ll get the agreement soon.

The 150km condition means that only people who weren’t residents of countries neighboring the Netherlands in the last 16 months to 2 years are eligible for the 30% ruling. So, if you were a resident of Luxembourg, Belgium, parts of France, the UK, and Germany, you can’t get the Dutch 30% ruling.

There are some exceptions to the rule, but you need to meet all of them to get the ruling:

  • You were employed in the Netherlands in the last 5 years
  • You had a positive 30% ruling or were eligible for one during your previous work period in the Netherlands
  • You lived 150km from the Dutch border for more than 16 months in the last 2 years during the last eligibility period.

For example, you moved to the Netherlands from Hungary 5 years ago. For the first 3 years, you worked for a company based in the country and received the 30% ruling, but then you moved to Belgium in 2022. You were offered a job in the Netherlands and decided to return in 2024 to work here again. In this case, you qualify for the 30% ruling again.

How long is the 30% ruling valid?

The 30% ruling is valid for 5 years or 60 months. Since January 1st, 2024, adjustments have been made to the 30% ruling, and now employees eligible for it receive their tax benefit differently:

  • first 20 months, you receive 30% of your salary tax-free
  • second 20 months, you receive 20% of your salary tax-free
  • third 20 months, you receive 10% of your salary tax-free

If you received a positive ruling in 2023 or prior to 1st January 2024, you’ll continue to receive the full 30% ruling for the entirety of the 5 years.

Don’t forget you need to submit your 30% ruling application within 4 months of starting your job to be able to receive it from the beginning of your employment contract. If you submit it later than 4 months, you’ll start receiving it from the submission date.

What is the salary limit for the 30% ruling in 2024?

From 2024, there is a limit to how much you can receive from the 30% ruling. If you’re earning €233,000 or higher, you’ll receive a maximum of €69,900 per year. If you receive the ruling for less than a year, your benefit will be based on the months you’ve been approved.

As the ruling is a percentage of your income, the more you earn, the higher your allowance. The minimum you can get is €13,851 annually based on the minimum required income of €46,170.

Can you lose the 30% ruling?

Generally, you can’t lose the 30% ruling. After receiving a positive decision, you’ll receive your allowance for the duration you were approved. However, if you’re unemployed for over 3 months during the period, you’ll lose the 30% ruling as you’ll no longer be considered an employee.

What happens if the 30% ruling was applied incorrectly?

If the 30% ruling is applied incorrectly, your employer will have to pay back the money. At the end of each year, the Dutch tax office (Belastingdienst) evaluates the rulings and taxes, and if they find that one of the conditions isn’t met, your employer will cover the difference.

The Dutch 30% ruling is a tax benefit through which skilled employees receive 30% of their salary tax-free. It allows foreigners to live in the Netherlands without worrying too much about living or renting costs. Now that you’re familiar with the terms of the ruling, you’re ready to accept that job offer and start planning your move.

This article is for informational purposes only.

Please reach out to content@housinganywhere.com if you have any suggestions or questions about the content on this page.

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