30 Percent Ruling in the Netherlands

The 30% facility (or ruling) is a Dutch tax break on earned salary for highly skilled migrants and foreign workers. The ruling is meant to attract internationals with a specific expertise to work in the Netherlands.

To get the ruling on your salary, as an expat or highly skilled migrant, you need to first apply and then receive permission and approval from the Dutch Tax Authorities.

At All About Expats we have experience aiding highly skilled migrants and expats through the application process for the 30% ruling.

Partnered with Dutch Tax Advice, we submit applications on the basis of a covenant with the tax authorities. As a result, this covenant also ensures a shorter process time: 4 weeks instead of the 4 months that applies by default.

To be eligible for the 30% ruling, you need to meet several conditions.

The following conditions apply to make use of the 30% facility:

In order to be considered as an incoming employee you must provide proof that you were living at least 150 kilometers outside of the Dutch border for 16 out of 24 months (about 2 years) prior to your first day of work in the Netherlands.

If a highly skilled migrant wants to make use of the 30% ruling, he or she must have specific expertise. To demonstrate this specific expertise a minimum income standard applies that is indexed yearly.

In 2023 specific expertise is shown if the highly skilled migrant has a taxable annual salary of at least € 41.954,00 (€ 39.467,00 in 2022), excluding the tax-free allowance.

For highly skilled migrants who have obtained a Dutch Master’s degree in scientific education or an equivalent foreign title, and are younger than 30 years of age, the minimum income standard is € 31.891,00 (€ 30.001,00 in 2022) excluding the tax-free allowance.

Daisy, a Java developer, is 31 years old and has agreed with her employer on a salary of €5.008,00 excluding 8% holiday allowance. This salary meets the minimum income standard applied by the IND for highly skilled migrants aged 30 or older.

The minimum salary requirement for the 30% facility is an annually taxable wage of € 41.953,00. This amounts monthly to € 3.496,08 including 8% holiday allowance. Without the 8% holiday allowance the monthly minimum is € 3.237,11.

The difference between the agreed wage of € 5.008,00, excluding 8% holiday allowance, and the required monthly minimum of € 3.237,00 amounts to €1.771,00. This is 35,36 % of the agreed wage, which is more than the 30% maximum allowable tax-free allowance for the 30% facility.

Daisy can therefore receive a maximum of 30% as a tax-free allowance, which amounts to €1.502,40 excluding 8% holiday allowance.
If you would like to have a custom calculation, feel free to contact us.

*The amounts mentioned in this table are excluding holiday allowance
** All calculations provided are for general reference only. For a more accurate calculation please contact our partner DutchTaxAdvice.

A maximum of 30% of your taxable wage is paid out as a tax-free allowance. Please note that a reduction in the gross wage can have consequences for the pension basis and any benefits or allowances, such as unemployment benefits and rent allowance. Once the application of the scheme expires, a fall in net income will occur.

If granted the 30% ruling, the employee will have the tax-break for a maximum of 5 years.

If the application is submitted within four months from the first day of employment, the 30% ruling will apply retroactively. If the request is not submitted within four months, the 30% rule will apply starting from the first day of the following month on which the application was approved by the Tax Authorities.

Therefore, it is necessary that you contact and provide All About Expats and Dutch Tax Advice the required information for the application of the 30% facility as soon as possible.

Additionally, please note that for the application a social security number is required. A social security number will be available to you after you register yourself at the municipality.

You can provide the required information by sending these documents to expatdesk@allaboutexpats.nl.

An expat who qualifies as a resident taxpayer of The Netherlands, can opt to be taxed as a deemed non-resident taxpayer. The advantage is that as a deemed non-resident taxpayer, the expat need not report any investment income to the Dutch Revenue (except for Dutch source income, such as Dutch real estate).

The choice will be made on the application form but can be changed every year. The expatriate can still deduct certain personal expenses (i.e. alimony payments, medical expenses etc.). Our Partner Dutch Tax Advice can advise you on this matter.

Expats to whom the 30%-ruling applies can exchange their foreign driver’s license for a Dutch license. This can be an advantage for expats from non EU-countries (EEA and Switzerland included), who can only use their foreign driver’s license for 6 months after their date of registry.

An employee who already has the 30% ruling can switch to a new employer and benefit from the 30% facility again (for the remaining period out of a total of 5 years).

Thus, the period between changing employment to another company may not exceed three months. The new employer needs to submit a new application for the 30%-ruling before this can be applied.

Changes to the 30% ruling are constantly happening.

We have written a blog detailing potential adjustments to the ruling suggested by MPs within the 2024 Tax Plan.

If you are moving to The Netherlands for work and would like to learn more about the 30% ruling and whether you can apply, feel free to schedule a consultation with our team.

Be sure to add us on LinkedIn so you can stay up to date on news relating to the 30% ruling and other topics pertinent to living in The Netherlands as an expat and highly skilled migrant.