How is your pension taxed in the Netherlands?
Your pension is Box 1 income, taxed at the rate for your age. Both your AOW (the Dutch state pension) and your company pension count as Box 1 income. The payer withholds loonheffing (wage tax) each month.
This page covers the payout side: what you pay once the money reaches you. It does not cover building up pension or cross-border and emigration rules. We cover building up pension in our pension gap guide. You'll find living abroad and foreign pots in foreign pensions.
Take Miguel, 67, retired in the Netherlands with a pension pot from working abroad. He also receives Dutch AOW plus a company pension. We work out his 2026 tax below. The AOW age is 67 in 2026, the age your state pension starts. If the Netherlands may tax Miguel's foreign pot, it adds to his Box 1 income.
In short
Box 1, not Box 3. Your AOW and pension count as income, not wealth.
17.85% first-bracket rate applies for every full year after you reach the AOW age.
35.75% below the AOW age on income up to €38,883 in the first bracket.
No AOW premium after the AOW age. That is why the rate drops to 17.85%.
Ouderenkorting up to €2,067. This senior citizens' credit lowers your 2026 bill.
Reaching the AOW age mid-year? The later in 2026 you reach it, the higher your rate.
Which rates apply after you reach the AOW age?
After the AOW age you pay 17.85% in the first bracket, not 35.75%. You stop paying the AOW premium of 17.90% once you reach the AOW age. The Anw (survivors' insurance) and Wlz (long-term care) premiums continue, so the rate does not fall to zero. The higher brackets stay the same: 37.56% and 49.50%.
Miguel has reached the AOW age, so he pays 17.85% on his first €38,883. If you were born before 1946 your first bracket runs to €41,123.
| Income bracket (2026) | Below AOW age | AOW age reached |
|---|---|---|
| First bracket (up to €38,883) | 35.75% | 17.85%(born before 1946: up to €41,123) |
| Second bracket (€38,883 to €78,426) | 37.56% | 37.56% |
| Third bracket (above €78,426) | 49.50% | 49.50% |
Which tax credits lower your bill?
The ouderenkorting (senior citizens' tax credit) is worth up to €2,067 in 2026. You get the full amount if your income stays below €46,002. Above that, the credit tapers to nothing at €59,782.
Single pensioners also get the alleenstaande ouderenkorting, the extra credit for single pensioners, worth €540. These credits come off your tax, so they lower what you actually pay. If more than one payer applies the credit, it can be applied twice. You then pay the extra credit back when you file your return.
What does Miguel actually pay in 2026?
On a €30,000 pension, Miguel pays 17.85% in the first bracket. His whole income falls in the first bracket, below €38,883. The tax before credits is €30,000 times 17.85%. That comes to €5,355.
The ouderenkorting takes €2,067 off, because his income is below €46,002. That leaves €3,288 before the general tax credit. He reached the AOW age before 2026, so the low rate applies all year. His algemene heffingskorting (general tax credit) is then €1,556, less 3.195% of the €264 his income is above €29,736. That €8 cut leaves €1,548. His tax after both credits is €1,740. If Miguel lived alone, the €540 single credit would also come off. We leave his foreign pot out here. Whether it changes his Dutch tax depends on the treaty with the country it comes from.
| Step | Calculation | Result |
|---|---|---|
| Pension income (Box 1) | AOW plus company pension | €30,000 |
| First-bracket rate (AOW age) | up to €38,883 | 17.85% |
| Tax before credits | €30,000 x 17.85% | €5,355 |
| Ouderenkorting | income below €46,002 | -€2,067 |
| Subtotal | €5,355 minus €2,067 | €3,288 |
| General tax credit | €1,556 minus 3.195% x €264 | -€1,548 (tax left: €1,740) |
“Most people worry they pay too much on their pension. Once you see the age brackets and the ouderenkorting, it becomes clear.”
What if you reach the AOW age during 2026?
In your AOW year, you pay a blend of both first-bracket rates. You pay the low rate only from the month you reach the AOW age. Your yearly rate weighs 35.75% and 17.85% by the months before and from that month.
The table below shows the rate by the month you reach the AOW age. You pay the AOW premium for each month before you reach the AOW age. Each such month adds one twelfth of the 17.90% premium to your rate.
| You reach the AOW age in | First-bracket rate |
|---|---|
| January | 17.85% |
| February | 19.34% |
| December | 34.26% |
What changes are coming for pensioners?
The AOW age stays 67 in 2026 and 2027. In 2028 it rises to 67 years and 3 months. Pension schemes must finish the move to the new system before 1 January 2028. That system is the Wet toekomst pensioenen. It is a system change, not a new tax rate.
We explain the annuity (lijfrente) in our annuity guide.
What should you check now?
Check that the withholding on your pension matches your age and your credits. Payers do not always apply the ouderenkorting or the right age bracket. An income-dependent healthcare contribution, the Zvw, also applies to your pension income.
Do you have pots in more than one country? The rules are different, and we cover those in foreign pensions. Want to check your withholding through your tax return? We handle that too on our tax return service. When the full picture matters, book a free intro call with a pension advisor. Miguel ran these checks too. His withholding turned out to be right.
How this fits your wider pension plan is on our page about pension advice.
belastingdienst.nl, Box 1 rates, brackets and tax credits 2026 · Accessed
svb.nl, AOW age · Accessed
rijksoverheid.nl, Transition to the new pension system (Wet toekomst pensioenen) · Accessed
Common questions about pension tax in the Netherlands
How much tax do you pay on your pension in 2026?
It depends on your age. Below the AOW age you pay up to 35.75% in the first bracket. From the AOW age you pay 17.85% on that bracket.
Why is the rate lower after the AOW age?
You stop paying the AOW premium. That premium is 17.90%. The Anw (survivors' insurance) and Wlz (long-term care) premiums still apply, so the rate becomes 17.85%, not zero.
What is the ouderenkorting in 2026?
The ouderenkorting is a tax credit for people who reach the AOW age. In 2026 it is worth up to €2,067. It tapers above an income of €46,002 and reaches nothing at €59,782.
Do you pay tax on your AOW?
Yes, your AOW is Box 1 income. The SVB can withhold wage tax on it. Together with your pension, it sets which bracket you land in.
What happens to your pension tax if you retire abroad?
That depends on the tax treaty with your country. Some pensions stay taxable in the Netherlands, others move abroad. Our foreign pensions guide sets out the treaty rules per country.
When do you reach the AOW age?
In 2026 and 2027 the AOW age is 67. From 2028 it becomes 67 years and 3 months. The SVB shows your exact date based on your birthday.