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It is almost that time of the year again: Budget Day 2020 (Prinsjesdag) is coming up. On every third Tuesday of September, the cabinet announces its new plans for next year. This year Budget Day will be held on Tuesday, September 15.
Budget Day will also be very different from other years. But what won’t change is the fact that the new plans will affect the Dutch tax system. In this article, we will discuss which tax changes are expected for 2021.
Simplify allowances
The current allowance system is quite complicated. The cabinet is searching for alternatives that will make this system simpler. Probably, a bill will be submitted that will simplify the allowance system.
Tax benefit for electric cars
Only ‘clean’ cars in the Netherlands: this is the target for 2050.
The government, therefore, wants to encourage the purchase of electric cars. The steps they are taking to achieve this goal is to increase the vehicle tax for cars with a combustion engine.
If you own an electric car, you do not have to pay for this motor vehicle tax. This tax benefit has been extended until 2025.
Income tax change
Every year, the rates of the income tax change, so also for 2021. In 2021 the expected rates are as follows:
| To € 68,507 | From € 68,507 | |
|---|---|---|
| 2020 | 37,35% | 49,50% |
| 2021 | 37,10% | 49,50% |
In addition, deductible items will be deductible for a maximum of 43% in 2021.
Changes in box 3
It is expected that new fixed-rate returns for taxation in box 3 will be announced on Budget Day 2020.
Besides, a new proposal will be presented to organize box 3 differently. This also happened last year, but the result was not beneficial for everyone. So, the adjustments were canceled.
There will be a new plan presented to accommodate savers and small investors. The tax-free allowance is expected to increase further.
No more transfer tax for starters
Are you between 18 and 35 years old and are you planning to buy your own house for the first time? Then you will be pleasantly surprised on Budget Day 2020. According to sources from The Hague, you will no longer have to pay transfer tax as of 1 January 2021. Now, this tax is still 2% of the purchase price.
In contrast, people who buy a second house will have to pay extra taxes. This transfer tax goes up from 2% to 8%. The government’s reason for this is to give young people a chance in the housing market. In the current situation, many investors are buying up most of the houses.
Deferred tax must be repaid within 2 years
Until October 1, 2020, entrepreneurs can still request a postponement for paying tax. However, the Belastingdienst will proceed to collection on 1 January. The cabinet has decided that two years is more than enough to repay this, without getting into financial trouble.
Moreover, they understand how difficult these times are for companies, so companies can also apply for a scheme when they do get into financial trouble.
In this article you can see what will change for you in 2021, from a fiscal point of view. Do you have any questions about this? Or do you have other tax-related questions? We are happy to help you. Contact us using the information below.
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