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The Dutch 30%-ruling explained

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The Dutch 30%-ruling explained

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On regular basis we advise expats and/or their employers on the 30%-ruling, part of this advisory is preparing the actual request for the ruling

As the interest of being granted the ruling can be very high, it is worthwhile to invest sufficient time to assess the exact situation of the employee compared to the applicable legal requirements. To this purpose please feel free to contact me to arrange a non obligatory meeting. You can also consult us for a second opinion on your pending request or in case your initial request has been denied. We work at a competitive fixed fee. In the article below the requirements of the 30%-ruling as per the year 2012 are summarized.

30% ruling

In the Netherlands a very interesting tax benefit is offered for specialist staff recruited from abroad. This tax benefit is known as the 30% ruling. This ruling can be granted after a request thereto at the tax authorities and is applied by the employer on the salary of the foreign specialists through the withheld wage tax. In order for the foreign specialist to qualify for this ruling, he/she has to meet certain specific (quality) requirements. In case the ruling is granted it will be applicable for a maximum period of ten years. In practical terms the ruling encompasses that 30% of the earnings from current employment (including one-time bonuses, etc.) is left tax exempt. In best case at least 30% of the income from current employment falls in the highest tax bracket which than leads to a tax benefit of 52% over that part of the income. Additionally, the system has other benefits; employers’ contributions to international schools for expat’s children remain tax exempt and driving licenses can easily be converted. An important additional tax benefit is that the tax liability, at the request of the employee, in the so called box 2 and box 3 is significantly reduced. The scheme has not remained undisputed during its existence, both in jurisprudence and in parliament. The Finance Secretary of State decided to make some changes in the system as per the year 2012.

Old and new legislation on the 30%-ruling
As of the year 2012 the legislation covering the 30%-ruling has been changed considerably. Employments which commenced before the year 2012 will fall under the old legislation which was applicable up till and including the year 2011. Employments, meaning the expat’s first employment in the Netherlands, which commenced as of the year 2012 will fall under the new legislation. The differences between the old and new legislation make it important to determine when your employment was first commenced.

The 30%-ruling legislation applicable as of the year 2012 for (first) employments in the Netherlands commenced on or after 1/1/2012:

Salary criterion -
In principle the 30%-ruling will be granted to expats when the following criteria are met. For starters a salary criterion is to be met. There are three qualifying salary groups: 1. Scientists will not have a salary minimum. 2. People below 30 years of age with a Masters education have a minimum salary requirement of EUR 26,605 excluding the 30% reimbursement and EUR 38,007 excluding the 30% reimbursement. 3. A general reduction, for the other groups of expats mentioned under 1 and 2, of the minimum salary requirement till EUR 35,000 excluding the 30% reimbursement and EUR 50,000 including the 30% reimbursement. Please note that these minimum amounts are subject to annual indexation. In principle the salary criterion may not be decreased pro rata in case of a part time employment. There is an exemption on this rule in case of parental leave. The salary criterion in principle replaces the old criterion of required specific skills, in that sense the ruling has become more accessible. Please note however that the salary criterion is a continuous test, the employer is therefore held to continuously check whether all requirements are still met by its employee.

Scarce skills -

Formally the scarcity of the expertise at hand must still be demonstrated, however only in case the salary of a certain group of professionals is as a standard above the salary criterion, e.g. soccer players.

150 kilometer criterion -

Persons living, for a period of 1/3 or more of the 24 months prior to the employment, within a radius of 150 kilometer (‘as the crow flies’) from the Dutch border are not eligible for the ruling. Please note this 150 kilometer area is calculated directly from the Dutch land borders, so not including the territorial/economic Sea area. For example former UK tax residents from London will qualify. Please note that this criterion could still be subject to a discussion by the EU commission due to possible discrimination. However a recent tax court decision has ruled that the 150 kilometer criterion is not in breach with EU law:


Previous stays in the Netherlands -

All previous stays, with some exemptions, in the Netherlands during the prior 25 years will be deducted from the maximum applicable term of the ruling.

Applicable term of the ruling -

The applicable maximum term of the ruling is 8 years. A request for the ruling is best to be filed within the first four months after the commencement of the employment as in that case the ruling will have retroactive affect until this commencement date. If the request is first filed after these first four months have passed, the ruling will only be applicable as of the month following after the month in which the request has been filed. Also in that case the preceding period will be deducted from the maximum applicable term of 8 years. Furthermore it is crucial that in case your employment is terminated, a new employment is commenced within three months after the last day at the previous employer. If this term is exceeded, the 30% ruling can not be commenced at this new employer. To commence your 30% ruling at a new employer again a new request for the ruling is to be filed at the tax authorities.

Please feel free to contact us for further information on this subject.


Jan-Hein van Leeuwen

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