The Dutch 30% ruling is a tax facility for employees who move to the Netherlands from abroad for work. It allows employers to grant a tax-free allowance to compensate for additional costs related to working and living in another country.

How does the ruling work?

Under the 30% ruling, an employer may pay up to 30% of the employee’s gross salary tax-free. This amount is considered compensation for extraterritorial expenses, such as relocation costs, housing expenses, and higher living costs.

Change: from 30% to 27%

The ruling is being amended. For employees who start applying the ruling on or after 1 January 2024, the following applies:

• In 2024, 2025 and 2026, the maximum tax-free allowance remains 30%.
• From 1 January 2027, the maximum allowance will be reduced to 27%.

Employees who already applied the 30% ruling before 1 January 2024 will generally retain the 30% allowance for the remainder of their ruling period (up to five years).

Income requirements

To qualify for the ruling, the employee must meet a minimum salary threshold. This income requirement is adjusted periodically and ensures that the ruling applies only to employees with specific expertise that is scarce on the Dutch labour market.

If you have any questions about your income or the application of the Dutch 30% ruling (27% ruling), please feel free to contact us. At TaxAble, we are happy to assist you with personal and professional advice.

Besides the impact on income, the 30% ruling also has important consequences for the taxation of assets in Box 3, particularly due to the abolition of the partial non-resident taxpayer status. You can read more about this here: https://taxable.nl/news/other-tax-news/expat-regime-30-ruling-and-box-3/

In the Netherlands, employee stock options are generally taxed through payroll (employment) taxation. Since 1 January 2023, payroll tax is in principle due when the acquired shares become tradeable, with an election to tax earlier at exercise.

The taxable benefit is typically the fair market value of the shares at the tax point minus the exercise price (and any employee contribution), and the employer withholds payroll taxes.

For innovative start-ups/scale-ups, a proposed regime has been announced aiming to reduce the tax burden (including a 65% tax base) and to defer taxation until (at the latest) sale/disposal of the shares. The intended effective date of this proposed regime is 1 January 2027, subject to parliamentary approval.

If you’d like to discuss what this means for your situation (valuation, tax point, documentation), feel free to send us a message.

The WBSO (Research and Development Tax Credit) is a Dutch tax incentive designed to stimulate innovation.

Companies engaged in research and development (R&D) may apply a reduction to payroll taxes for employees performing qualifying R&D activities. Application requires prior approval from the Netherlands Enterprise Agency (RVO). The benefit is applied through the payroll tax return and provides an immediate cash-flow advantage.

If you would like to learn more about the WBSO scheme or how it applies to your situation, please feel free to send us a message.

Corporate income tax losses can be offset against profits from other years. A loss is first set off against the profit of the preceding year (carry back). Any remaining loss can then be offset against future profits (carry forward). Losses may be carried forward indefinitely.
An annual limitation applies: up to €1,000,000 of taxable profit can be fully offset; for profits exceeding this threshold, 50% of the remaining profit is eligible for loss utilisation.
If you would like more information on how loss utilisation applies to your specific situation, please feel free to contact us.

As of 1 January 2025, it is no longer possible to opt for partial non-resident taxpayer status in the Dutch personal income tax return. This change is particularly relevant if you make use of the 30% ruling, as new developments related to the expat regime box 3 30% ruling may impact your tax situation.

However, if you applied for the expat regime (30% ruling) before 2024, transitional rules apply. Under these rules, you may continue to apply the partial non-resident taxpayer status for the 2025 and 2026 tax years, especially if your situation involves the expat regime box 3 30% ruling.

This means that during this transitional period, Box 3 assets (such as savings and investments) connected to the expat regime box 3 30% ruling do not need to be reported in your Dutch personal income tax return.

From the year following the transitional period, Box 3 assets will need to be included, which may have a significant impact on your tax position. Therefore, understanding the expat regime box 3 30% ruling is crucial when planning ahead.

TaxAble is happy to assist you in assessing the impact and ensuring your tax filings remain correct and optimized.

In addition to the Box 3 consequences of the 30% ruling, recent changes also affect how income is taxed under this regime. You can read more about the reduction from 30% to 27% and its impact on income here: https://taxable.nl/news/other-tax-news/income-and-the-dutch-30-ruling-reduction-to-27-from-2027/