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You are here: Home / Personal Tax / Personal income tax rates / Personal income tax rates 2020

Personal income tax rates 2020

Personal income tax rates 2020

Personal income tax rates 2020 for income from (former and/or self-) employment and home ownership (also referred to as “box 1”):

Annual taxable income in 2020 (€) Not more than 68.507 More than 68.507
Tax rate 37,35% 49,50%
                           Reached the AOW (State pension) age and born after 1945:
Annual taxable income in 2020 (€) Not more than 34.712 More than 34.712 but not more than 68.507 More than 68.507
Tax rate 19,45% 37,35% 49,50%
                        Reached the AOW age and born before 1946:
Annual taxable income in 2020 (€) Not more than 35.375 More than 35.375 but not more than 68.507 More than 68.507
Tax rate 19,45% 37,35% 49,50%

 

The income-related health insurance contribution (a mandatory fixed contribution from your income or benefit) will be reduced by 0.25% this year. This applies to the contribution from your income, which your employer does, as well to benefit entitled persons and self employed. See the table below for the applicable rates:

2020 2019
Employer contribution (high contribution) 6,70% 6,95%
Contribution of e.g benefit entitled persons & self employ (low contribution) 5,45% 5,70%

 

Please note that several tax rebates (“heffingskortingen”) may apply. They lower the tax and premium payable. These tax rebates have been increased for 2020. See the table below for the applicable rates:

2020 2019
Maximum general tax rebate under AOW age (€) 2.711 2.477
Maximum general tax rebate above AOW age (€) 1.413 1.268
Maximum labour tax rebate (€) 3.819 3.399
Maximum income-related combination tax rebate (€) 2.881 2.835
Young disables person tax rebate (€) 749 737
Elderly person tax rebate (€) 1.622 1.596
Single elderly person tax rebate (€) 436 429
Tax rebate green investments 0,7% 0,7%

 

Personal income tax rate 2020 for income from substantial share ownership, applicable when owning 5% or more of the shares in a limited company (also referred to as “box 2”): 26,25% flat tax rate (2019: 25%) on all earnings following from these shares, such as dividends and capital gain.

Personal income tax rate 2020 for income from equity: 30% flat tax rate on (progressive) deemed interest made on equity. In brief equity can be summarized as (worldwide held) assets minus (worldwide held) debts. The point of departure is the value of the equity per beginning (January 1st) of the relevant tax year. Based upon this value the deemed taxable income (benefit from savings and investments) is calculated.
The tax burden on your assets in box 3 in 2020 is 0.54% to 1.60%, depending on the size of these assets. See the table below for the applicable rates:

Of the part of the equity that is higher than (€) But not more than (€) Deemed interest is The income tax as % of box 3 equity is
0 (partners: 0) 72.797 (partners: 145.594) 67% + 0,06% + 33% + 5,33% = 1,7991% 0,54%
72.797 (partners: 145.594) 1.005.572 (partners: 2.011.144) 21% + 0,06% + 79% + 5,33% = 4,2233% 1,27%
1.005.572 (partners: 2.011.144) – 0% + 0,06% + 100% + 5,33% = 5,33% 1,60%

 

 

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