What's the 30% tax ruling for Expats in the Netherlands?
Employees who are seconded to work abroad or who come to work in the Netherlands from another country are referred to as extraterritorial employees. If these employees meet certain conditions, they fall under a special expense compensation scheme: the 30% facility.
This facility means that the employer may provide 30% of the salary as an allowance for the additional expenses incurred due to the temporary stay of his employees in another country, or, if the employer attracts an employee from abroad, for his temporary stay in the Netherlands. This concerns 30% of the salary from current employment, including the allowance itself. This allowance is untaxed.
Employers are free to grant this allowance, as well as to cooperate with an employee's request for such an allowance. Application of the 30% facility, however, is subject to approval by the tax inspector.
Using the 30% facility has several additional effects for you as an employee, including:
- The 30% expense allowance is calculated over the monthly salary, holiday allowance and end-of-year bonus.
- Because the 30% facility already allows you to make maximum financial use of the Selection Model, you cannot make use of the other money-related trade-off options in the Selection Model. Only time-related choices such as flexible working hours, saving for sabbatical, extending parental leave, etc. can be used.
- You cannot claim further expense allowances that qualify as extraterritorial expenses, for example an untaxed allowance for the costs of double accommodation or the costs of Dutch language courses.
- You are not eligible for a labor market allowance within the meaning of Article 3.13 of the CAO-NU.
- No contributions are levied for the employee insurance schemes (WW, WIA) on the untaxed expense allowance (30% expense allowance). Any future payment based on these schemes will therefore be lower.
- At the end of the period in which the 30% facility is applied, the net income will decrease. You are not entitled to compensation for this decrease.