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The Dutch 30% ruling

Employees coming to the Netherlands can benefit from the 30% facility. The term of the 30% ruling is a period of five years. It requalifies the top 30% of the salary to expenses for the initial period of 20 months. Therafter the top 20% for the second period of 20 months and top 10% for the third and last period of 20 months. As the Netherlands has a progressive personal income tax system, the ruling brings down the taxation of high salaris with around 35% in the first 20 months. 

Before 1 January 2024 employees could still benefit for a 30% ruling requalifying the top 30% for a period of 60 months. The recent change to a 30%/20%/10% scheme has no impact on employees already using the 30% ruling before 1 January 2024.

What is a 30% ruling?


Highly skilled migrants can make a request for a so called “30% ruling”. An arrangement for employees who are hired abroad to work in the Netherlands and allows payment of 30 percent of their salary as a tax-free allowance to compensate for the extra expenses of moving and living abroad. 

The 30% ruling is also relevant for the tuition fees. The extraterritorial employee will in such case be compensated for the costs of his/her children attending primary or secondary international schools and international departments of non-international schools, up to the amounts charged by the school according to its rates for education, with the exception of costs and accommodation expenses but including travel expenses.

What are the conditions to be eligible for the 30% ruling?

> There has to be an employment situation. 

As proof of the employment situation an employment agreement shall be concluded. Self-employed persons do not qualify.

> The incoming employee should have specific expertise/certain salary level. 

For the evaluation of whether an entered employee possesses specific expertise that is scarce or absent on the labor market in the Netherlands, a minimum salary requirement exists. This salary requirement replaced the obligation to proof the level of education and relevant work experience. This information may still be relevant when scarcity has to be proven.

For the year 2024, the following amounts apply for the 30% ruling:

- minimum required taxable gross salary is € 46,107 per year/€ 3,842.25 per month (2023: €41.954 per year/€ 3,496.17 per month);

- for employees under the age of 30 who have obtained a master degree at a foreign university the minimum required taxable gross salary is € 35,048 per year/€ 2920.67 per month (2023: €31,891 per year/€ 2,657.59 per month).

- no salary standard applies to scientists and employees who are doctors in training up to specialists.

The required salary amounts change every year based on the applicable index rates.

> Distance requirement - 150 kilometers

An incoming employee must have lived more than 150 km from Dutch border for more than eight months out of the 24 months prior to the commencement of employment in the Netherlands. Distance is measured in a straight line from the city the employee lived in to the closest Dutch border. 

The salary to which the 30% ruling can be applied is not capped in 2023. As of January 1, 2024, the 30% ruling will be limited to the remuneration standard for top executives in the Top Income Standards Act (WNT standard). In 2024, this WNT standard will amount to € 233,000 per year. 

So, a maximum of € 69,900 (30% of € 233,000) may be reimbursed tax-free within the 30% scheme. If this is not sufficient in an individual case, instead of the 30% ruling, one can still receive tax-free reimbursement of the extraterritorial costs actually incurred without a cap.

What is the term of the 30% ruling?

For employees entered before 01 Janaury 2021, the term is eight years, starting on the first day of employment by the employer. This term has been shortened to five years as per the date of 01 January 2021.

What happens with the 30% ruling in case of a new job?

Expats who are moving to a new position or a new employer will still be able to benefit from the 30% ruling. The employee and employer have to request the tax authorities to continue to apply the 30% ruling on the new position. The scarcity shall be proven once more. Also there can not be a period of more than three months of unemployment in between two jobs.

What are the benefits of the 30% tax ruling?

In addition to the fact that 30% of the salary will not be taxed for personal income tax, the following two benefits apply:

> Under the 30% ruling it is possible to opt for the ‘partial non-residency status’. For Box 1 income the employee will be considered a resident tax payer. Though foreign income and assets do not have to be included into Box 2 and Box 3. Except for real estate located in the Netherlands and substantial shareholding in a Dutch resident company. Next thereto the employee will be entitled to a partnership ruling in Box 1.

Note that this partial non-resident taxpayer status is expected to be abolished as per 1 January 2025. For employees who receive the 30% tax ruling before 1 January 2024, their non-resident taxpayer status is going to be abolished per 1 January 2027 instead of 1 January 2025.

> The employee’s foreign driving licence can be converted into a Dutch license. Without the 30% ruling many foreign nationals have to retake their exam.