The 30% ruling
Requirements
Benefits
The 30% ruling is a tax advantage for highly skilled migrants who moved to the Netherlands for a specific employment role. If you are eligible for the 30% ruling, up to 30% of the gross salary from current employment can be reimbursed tax-free. This means that, if you are eligible for the 30% ruling, you dont have to pay taxes over 30% of your gross salary in the Netherlands.
Did you move to the Netherlands to work for a Dutch employer? The Dutch tax office (Belastingdienst) is of the opinion that employees who came to the Netherlands are confronted with extra costs, so-called extraterritorial costs. As compensation for these costs, your employer may give a tax-free allowance for this. The other option is that the employer provides 30% of the wage, including reimbursement, tax-free. This is also known as the 30% ruling. On this page, we further explain the 30% ruling and its benefits.
Did you move to the Netherlands to work for a Dutch employer? The Dutch tax office (Belastingdienst) is of the opinion that employees who came to the Netherlands are confronted with extra costs, so-called extraterritorial costs. As compensation for these costs, your employer may give a tax-free allowance for this. The other option is that the employer provides 30% of the wage, including reimbursement, tax-free. This is also known as the 30% ruling. On this page, we further explain the 30% ruling and its benefits.
From 1 January 2024 the 30% ruling has been changed once again, this time to a reduced rate of 27% from 2027 onwards. The reduced rate is only for employees who started using the 30% ruling on the 1st of January or after. Employees that already enjoyed the 30% ruling before 2024, will be able to continue to get 30% of their salary tax-free for the five year period.
If the 30% rule started before 1 January 2024:
The 30% ruling has three benefits besides the tax-free salary part. These are the benefits of the 30% ruling:
The main advantage of the 30% ruling is the tax-free salary part. If you benefit from the 30% ruling, your employer may reimburse 30% of your salary tax-free. Your taxable income will be lower, which means that you pay less tax than someone without the 30% ruling.
In the example, we use a monthly gross salary of € 10,000 to calculate. Based on the table, you can clearly see the difference between the same salary of someone with and without the 30% ruling.
| With 30% ruling | Without 30% ruling | |
|---|---|---|
| Gross | € 10,000 | € 10,000 |
| Tax-free amount (30%) | € 3,000 | – |
| Taxable | € 7,000 | € 10,000 |
| Tax | € 2,800 | € 4,300 |
| Net | € 7,200 | € 5,700 |
As of 1 January 2025, the option for expats with the 30% ruling to choose partial non-resident taxpayer status will be abolished. This status currently allows individuals who are fiscally resident in the Netherlands to be treated as non-resident taxpayers for Box 2 (substantial interest) and Box 3 (savings and investments). As a result, foreign assets in these boxes are exempt from Dutch tax, except for Dutch real estate and substantial interest in a Dutch company. For Box 1 income (employment and home ownership), you are always treated as a resident taxpayer.
Those who applied the 30% ruling in their final pay period of 2023 may continue to use partial non-resident taxpayer status until the end of 2026. Anyone starting with the 30% ruling in 2024 can only apply this status for the year 2024, and will be treated as a full Dutch tax resident from 2025 onwards, including for Box 2 and Box 3.
If the 30% ruling ends partway through a calendar year, you must still declare your total Box 3 assets as of 1 January for that entire year, as if the ruling had not applied at all. If you only want to be taxed for the period after the ruling ended, you must first file your tax return, then wait for the final assessment, and subsequently file an objection. The Dutch Tax Authority will then adjust the Box 3 tax proportionally to the number of months without the 30% ruling.
For existing users from before 2024, the maximum tax-free allowance of 30% will remain in place for 2025 and 2026. The reduction to 27% will only take effect for them from 2027, and the salary threshold increase will not apply. For new users starting in 2024, the salary threshold will remain fixed (indexed) for the full duration of their ruling, but the reduction to 27% will still apply starting in 2027.
Another great benefit of the 30% ruling is the possibility to exchange your foreign driver’s license for a Dutch driver’s license. In most cases, you have to redo your driver’s license test in order to obtain a Dutch driver’s license. If you have the 30% ruling. It is possible to exchange your foreign driver’s license for a Dutch license without redoing the test. And even all of your family members at the same address as the holder of the 30% ruling don’t have to redo the test.
Lower taxes for five years.
The largest benefit of the 30% ruling is that your employer can give you a tax-free allowance of 30% of your income, as long as you meet the requirements.
Partial foreign tax liability
With the 30% ruling, you can (until 2025/2026) make use of partial foreign tax liability. This means that you do not have to declare your foreign assets in the Netherlands, which saves on administration and prevents double taxation.
Dutch driver’s license
As a 30% ruling holder, it is often easier to exchange your foreign driver’s license for a Dutch driver’s license. In many cases, you will be treated as a non-resident, which means that the normal 185-day residence requirement does not apply.
Higher mortgage capacity The tax benefit of the 30% ruling gives you a higher net income. This significantly increases your mortgage capacity. Banks often calculate your total gross salary plus the 30% benefit, allowing you to buy a more expensive house than would be possible without the ruling.
The 30% ruling applies to employees with specific expertise who are transferred to the Netherlands or recruited from abroad. These employees are also referred to as highly skilled migrants. There are a number of conditions that must be met in order to qualify for the 30% ruling.
For Dutch nationals returning to the Netherlands, the duration of the 30% ruling is reduced by the period you have lived in the Netherlands. In most cases, this means that Dutch nationals returning to the Netherlands are not entitled to the 30% ruling.
For Dutch nationals returning to the Netherlands, the duration of the 30% ruling is reduced by the period you have lived in the Netherlands. In most cases, this means that Dutch nationals returning to the Netherlands are not entitled to the 30% ruling.
The 30% ruling exists because the Netherlands sometimes needs people with special knowledge and skills that are difficult to find here. This concerns expertise that is scarce on the Dutch labor market. Think, for example, of specialists in technology, scientists, or managers with unique experience.
The Dutch government uses your salary as proof that you have these special skills. The idea is simple: if a company is willing to pay a lot of money for your knowledge, then you probably have expertise that they cannot easily find here.
The Netherlands wants the 30% ruling to be used only by people who have come to the country specifically to work. That is why your employer must have hired you while you were still living abroad. At the time you signed your contract, you were not yet allowed to live or work in the Netherlands.
The Dutch Tax and Customs Administration looks at your personal situation to determine where you live. If you have strong ties to the Netherlands, for example through family, a house, or other important connections, you will be considered a Dutch resident. These ties do not have to be stronger than those with other countries. What is important is where you were when you signed your employment contract.
To provide clarity, the government uses the 150-kilometer rule. This rule makes it easy to determine whether someone really comes from far away:
For most people: You must have lived at least 16 months within 24 months before your first working day in the Netherlands more than 150 kilometers from the Dutch border.
For people with a doctorate: Did you obtain a PhD? Then the time before you started your PhD counts. You had to live more than 150 kilometers from the Netherlands for 16 of the 24 months before the start of your PhD research. During your PhD and afterwards, you were allowed to live close to the Netherlands.
These rules ensure that only people who really come to the Netherlands because of their special knowledge can make use of the 30% ruling. It prevents someone who, for example,
For the 30% ruling, you always need a Dutch employer who pays your salary and deducts tax. You must be employed, as the ruling does not apply to self-employed persons or other forms of employment. The most important point is that you cannot do anything yourself without your employer. The application for the 30% ruling must always be made by your employer. You cannot arrange this yourself with the Tax and Customs Administration.
There is a good reason for this: your employer must also implement the ruling in practice. Every month, he or she must withhold the correct amount of tax and calculate the 30% allowance correctly. This is all done through the company’s payroll administration.
That is why it is wise to discuss whether your employer is willing to apply for the 30% ruling for you before you come to the Netherlands. Some employers are not familiar with the ruling or find it too much administrative hassle. Without their cooperation, you simply will not receive the tax benefit. It is therefore wise to discuss this point thoroughly before you start your job.
To apply, use the form ‘Request for expatriate tax relief (30% ruling) 2025’. Both you and your employer must complete and sign this form truthfully.
You must enclose various documents with the form to prove your situation. The Tax and Customs Administration always asks for your CV and signed employment contract. Additional documents are often required to prove that you are eligible for the scheme.
The complete package, including the form and all documents, must be sent by post to the Tax and Customs Administration Knowledge and Expertise Center for Foreign Affairs. You cannot submit this digitally; everything must be printed out and sent by post.
Make sure your application is complete. The Tax and Customs Administration will only start assessing your application once they have received all the information. If something is missing, it will take longer to receive a response.
Once your application is complete, the Tax and Customs Administration has a maximum of 8 weeks to respond. Therefore, always check carefully that all documents are included in your package before sending it.
For each application for the 30% ruling, you must send the special form to the tax authorities. Which additional documents you need depends on your situation, but two documents are always required:
A copy of your signed employment contract
Your resume
Because the rules for the 30% ruling are complicated, the tax authorities often ask for more documents. This depends on your personal situation. Examples of additional documents are:
Your master's degree (if you are younger than 30)
A diploma evaluation if your diploma is from abroad
Proof that you lived abroad, especially if you have lived in the Netherlands before
It is very important to think carefully in advance about which documents the tax authorities are likely to want to see from you. If you send all the correct documents right away, your application will be processed much faster. If you forget something, you will have to wait until they contact you for the missing documents.
Your employer will fill in an important part of the form with company details such as the name, address, payroll tax number, and contact person.
The most important thing is that your employer officially confirms that you have agreed to use the 30% ruling and that your salary will remain above the minimum after applying the ruling.
This signature and confirmation are mandatory—without your employer's cooperation, the application cannot be processed.
The 30% ruling applies for a maximum of 5 years. If you have previously lived or worked in the Netherlands, this time will be deducted from the 5 years. This is called the reduction scheme.
The Tax and Customs Administration looks at previous periods in the Netherlands that ended less than 25 years ago. The longer you were in the Netherlands before, the shorter your 30% ruling will be.
There are exceptions that do not count:
A maximum of 20 days of work per year in the Netherlands.
A maximum of 6 weeks per year for vacation, family visits, or other private reasons.
A one-time maximum of 3 consecutive months for private purposes.
These short periods therefore do not affect the duration of your 30% ruling.
For each application for the 30% ruling, you must send the special form to the tax authorities. Which additional documents you need depends on your situation, but two documents are always required:
A copy of your signed employment contract
Your resume
Because the rules for the 30% ruling are complicated, the tax authorities often ask for more documents. This depends on your personal situation. Examples of additional documents are:
Your master's degree (if you are younger than 30)
A diploma evaluation if your diploma is from abroad
Proof that you lived abroad, especially if you have lived in the Netherlands before
It is very important to think carefully in advance about which documents the tax authorities are likely to want to see from you. If you send all the correct documents right away, your application will be processed much faster. If you forget something, you will have to wait until they contact you for the missing documents.
Your employer will fill in an important part of the form with company details such as the name, address, payroll tax number, and contact person.
The most important thing is that your employer officially confirms that you have agreed to use the 30% ruling and that your salary will remain above the minimum after applying the ruling.
This signature and confirmation are mandatory—without your employer's cooperation, the application cannot be processed.
The 30% ruling automatically ends on the date stated in the decision you received from the tax authorities. After this date, you can no longer use the ruling.
This means that from that moment on, your entire salary will be taxed according to the normal Dutch tax rates. You will then pay more tax because you will no longer receive the 30% benefit. It is therefore important to remember when your scheme expires so that you can adjust your financial planning accordingly.
With the 30% ruling, your tax return will show a lower income than you actually earn. This is because 30% of your salary is paid tax-free and does not count towards your tax liability.
What happens when the scheme ends?
Your entire salary will then be taxed, meaning you will pay more tax. But there is an additional effect: you will also lose tax credits because your taxable income will be higher.
Two important credits will be reduced:
General tax credit: will be lower for higher incomes.
Employee tax credit: will be phased out for incomes above €43,000.
The loss of the 30% ruling will therefore cost you twice as much: more tax and fewer credits. This makes the financial difference greater than just the 30% you lose.
Until now, employees under the 30% ruling did not have to declare their foreign assets in the Netherlands. This was known as partial foreign tax liability. Only Dutch assets, such as a house here, had to be declared.
This will change from 2025. New 30% ruling holders (from 2024/2025) will now have to declare all their worldwide assets. Only people who already had the ruling before 2024 will be able to continue to use the old rules until 2026.
Does your 30% ruling expire during the year? Then it gets complicated. You must declare your entire assets as if you had never had the ruling. After the final assessment, you can file an objection to get a tax refund for the months that you were still entitled to the ruling. This means that you will ultimately only pay tax on the assets for the period after the ruling ended.
Returning Dutch nationals may technically be entitled to the 30% ruling, provided they have lived abroad for at least 25 years and are employed before returning. When assessing this, the Tax and Customs Administration looks at the period of previous employment and residence in the Netherlands up to 25 years before the first working day with the new employer. If a Dutch national has been abroad for less than 25 years, their previous residence in the Netherlands is deducted from the duration of the scheme on the basis of the discount scheme. As a result, in most cases there is no remaining term for the application of the 30% ruling. Therefore, returning Dutch nationals are generally not entitled to apply the 30% ruling unless they have lived outside the Netherlands for at least 25 years.
The Tax and Customs Administration application form contains two specific exceptions when answering the question of whether the employee lived more than 150 kilometers from the Dutch border for more than 16 months in the 24 months prior to their first working day in the Netherlands.
PhD candidate: If the employee has obtained a PhD, he or she must have lived more than 150 kilometers from the Dutch border for at least 16 months of the 24 months prior to the start of the PhD research. During the PhD research and the period between obtaining the PhD and the start of employment, the employee may have lived in the Netherlands or within 150 kilometers of the border.
The exception to this is that the 150-kilometer requirement is not assessed in relation to the period prior to the first working day with the new employer, but in relation to the period prior to the start of the PhD research.
Example:
A PhD student applies for the 30% ruling from a Dutch withholding agent. In the 24 months prior to her first working day, she was in Belgium, on the Dutch border, conducting scientific research with the aim of obtaining her doctoral degree (PhD). Prior to the start of her PhD research, she was living in Spain.
Based on the original 150 km criterion, she would not qualify, as in the 24 months prior to her first working day with the Dutch employer, she was in Belgium, on the Dutch border, conducting scientific research with the aim of obtaining her doctoral degree (PhD). Prior to the start of her PhD research, she was living in Spain.
As of 1 January 2024, the 30% rule may only be applied up to the maximum income stipulated in the Top Income Standard Act, the so-called Balkenende norm. In 2024, this is set at €233,000, in 2025 this was increased to €246,000, and for 2026 it has been further raised to €262,000; up to a maximum of 30% of this WNT norm, an employer may still provide tax-free compensation. A transitional rule applied for employees who already used the 30% rule in December 2022 — for them, the capping measure did not apply until 1 January 2026.
Another adopted amendment to the 2024 Tax Plan also abolishes partial foreign tax liability from 1 January 2025. This means that from 1 January 2025, box 2 and box 3 assets will also be taxed.
The transitional rule applies if the 30% rule has already been applied to payroll by December 2023. This transitional rule means that the ‘old’ 30% rule remains fully applicable. This means that for anyone who enjoyed the 30% rule before January 2024, there are no changes. Even if the employee switches employers, the transitional rule will continue to apply under certain conditions, in which case it is important that the employment contract was agreed upon within 3 months of the end of the previous employment. Employees who enjoyed the 30% rule over the last pay period of 2023 can still use the exemption for box 2 and box 3 until 2026 based on the transitional law.
From 1 January 2019, the duration of the 30% ruling is 5 years. During these 5 years, employees were allowed to receive up to 30% of their income taxable in the Netherlands untaxed. You are also considered a foreign taxpayer for box 2 and box 3, which means your box 2 and box 3 assets are untaxed in the Netherlands. Except for property in the Netherlands and a substantial interest in a Dutch BV or NV. For the income in box 1, however, you remain taxable.
The expiration of the 30% ruling reduces net income and ends exemptions like partial non-resident taxpayer status. We outline the impact on tax returns, including changes in liabilities and considerations for assets and fiscal partnerships. What are the fiscal consequences if the 30% ruling expires after 5 years? We explain it in our blogpost about what happens when your 30% ruling ends.
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Boy Mulder2025-08-26 10:17:142025-08-29 09:47:39The 30% ruling expires: fiscal consequencesTalk directly to one of our tax advisors
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