30% Ruling

What is the 30% Ruling? 

The 30% reimbursement ruling is a tax advantage for high skilled migrants and high-paid workers moving to the Netherlands. When the necessary conditions are met, the employer may compensate you for so-called ‘extraterritorial costs’ untaxed. Your employer may also choose to pay you 30% of your salary, extraterritorial costs included, tax-free. This is the 30% facility (aka 30% ruling).

For obtaining 30% Ruling you must meet all of the following conditions:

• You are in paid employment.
• You have a specific expertise that is not or hardly found on the Dutch labour market. You have that expertise if your salary, not including the tax-free allowance in the Netherlands, is more than €46,107 (in 2024). If you are younger than 30, and you have a Dutch academic master’s degree or have you obtained an equivalent title in another country then you have a specific expertise if your salary is more than €35,048 (in 2024).
• You were recruited outside of the Netherlands. You must have lived at a distance of more than 150 kilometres as the crow flies from the Dutch border for more than 16 months in the 24 months prior to your first working day in the Netherlands. You are not allowed to have lived in Belgium, Luxembourg and parts of Germany, France or the United Kingdom.
• You are in possession of a valid decision. If it was issued after 1 January 2019 it will be valid for a maximum of 5 years. Issued between 1 January 2012 and 1 January 2019 decision has a maximum duration of 8 years.

Important update! On December 19, 2024, the Dutch Parliament debated and voted on the Tax Plan 2024 (Belastingplan 2024), including two amendments that were proposed to change the 30% Ruling and the status of partial tax residents.

Under the new rules, which will come into effect on January 1, 2024, the 30% Ruling will be phased out for all new expats moving to the Netherlands.

• The first 20 months of employment in the Netherlands: 30% of the salary is tax-free.
• The next 20 months of employment in the Netherlands: 20% of the salary is tax-free.
• The last 20 months of employment in the Netherlands: 10% of the salary is tax-free.

Additional benefits. Partial foreign tax obligation.

You can opt for partial foreign tax liability in your income tax return, if you live in the Netherlands and make use of the 30% facility. You are then a non-resident taxpayer for your taxable income from substantial interests (box 2) and your taxable income from savings and investments (box 3). This can be advantageous for you as you will pay tax on a lower taxable income in Box 2 and Box 3.

You can be a partial non-resident taxpayer from the 1st day of the calendar year in which you choose to do so, but not before the 1st day you use the 30% facility.

Driving Licence: If you have a foreign driving licence with 30% ruling you can switch it to Dutch driving licence without retaking the test.

Discover the financial advantages of the 30% ruling for highly skilled migrants. Contact us today to learn more and ensure you receive the tax benefits you deserve.