Congratulations! You’ve successfully secured that dream job in the Netherlands. Now you need to make sure you get the most out of the tax system. Tax breaks are a nice extra and if you know your rights the benefits can add up to a considerable sum. After all, there are few things the Dutch love more than a discount.
The Dutch knowledge economy has prospered by attracting migrants with the right type of expertise, so it makes sense for the government to make it as appealing as possible for people like yourself to come and work here.
To attract foreign specialists whose field of knowledge is scarce or unavailable in the Netherlands, the Dutch government introduced a special tax facility for expats known as the 30% ruling.
Briefly put, this tax advantage means that you only pay income tax on 70% of your gross salary, so the remaining 30% is tax free. This tax benefit is applicable to expat employees working in the Netherlands as long as they meet certain requirements.
The 30% ruling in detail
If you’re coming to work in the Netherlands your earnings are dependent on your job group and salary grade, and possibly a collective labour agreement (cao). A special cao is in place for temporary and flexible workers. You can read all about that here.
So who qualifies for the 30% ruling? You’re allowed to make use of the rule for a maximum period of eight years, provided you meet the income requirements set out by the Dutch Immigration and Naturalisation Service (IND). The 30% ruling makes it financially more attractive for employers to hire you as their employee, but of course you benefit too in the form of a lower tax bill.
There are plenty of jobs in the Netherlands, but some companies are still hesitant to hire highly skilled migrants. A recent political audit has also called for a thorough check on the effectiveness and consequences of the 30% ruling.
But regardless of any changes, umbrella services can take care of all your needs, from screening and advice on how to implement the 30% ruling in your payroll administration to payroll calculations and dealing with the Dutch tax authorities, as well as all the administrative burdens.
If you want to arrange this quickly and conveniently the Dutch Umbrella Company can assist you in the entire process. Use the Dutch Income tax calculator to calculate your net pay and the Dutch Umbrella Company will get in touch with you as soon as possible.