3 May 2018

30% tax advantage to be shortened in 2019

The Dutch government announced that the 30% ruling for expats, a tax advantage for highly skilled migrants working in the Netherlands, will be shortened from eight years to five. This was announced in October 2017 but the government is now planning to make it effective as per 1 January 2019.

The ruling allows employers to offer 30% of an employee’s salary to them tax-free, meaning that the employee only pays tax over 70% of their gross Dutch salary. It is meant as a reimbursement for the costs incurred when relocating to the Netherlands.

This tax advantage was put in place to attract specialists from other countries who have particular expertise which is not available in the Netherlands. However, a recent research has found that 80 percent of employees receiving the 30% tax advantage do not make use of it for more than five years.

This change will apply to both newcomers applying for the ruling and those already receiving the tax advantage. 







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