Dutch tax rules 2020
The Dutch tax system changes every year, this doesn’t make the system easier. This year, 2020, the tax rules changed again. The TaxSavers clarifies the most important changes of 2020 on this page.
The tax brackets
The biggest change of 2020 comes from a change in the tax brackets. The Dutch tax system consisted of 4 tax brackets in 2019. Now, in 2020, we only have 2 tax brackets left. The main goal of this modification is to make our tax system easier. In the table mentioned below, the changes are explained.
|tot €20.384||€20.385 – €34.300||€34.301 – €68.507||vanaf €68.508|
|tot €68.508||vanaf €68.508|
Apart from the fact that the tax system becomes easier, it gives the most people a fiscal advantage. Up to an amount of €20.384 the tariff rises, however the labor rebate and the general levy rebate rise as well. Such that the low-incomes have a fiscal advantage due to the modification of the tax system as well.
Mortgage interest deduction
As of 2019, the mortgage interest deduction will be reduced more quickly. In 2019 the mortgage reduction interest tariff was at a maximum of 49%. In 2020, this tariff declined to 46%. In 2023 this tariff will be no more than 37,05%. This adjustment will only have consequences for the people with an income in the highest tax bracket, this concerns incomes above € 68.508. People with an income below this limit will not face a fiscal disadvantage.
This adjustment also applies to other deductions (e.g. gifts and health costs). So, the tariff for other deductions declined to 46% as well, and will further decline to 37,05% in 2023. The same applies here: only people with an income in the highest tax bracket will face consequences due to this adjustment.