30% -ruling

The 30% -ruling allows employers to grant certain employees with special skills or expertise which is scarce or absent on the Dutch labour market a maximum tax-free allowance of (approximately) 30% of their salary as far as it exceeds the minimum taxable salary criterion given below. To qualify, the employee must -amongst others- be hired from abroad and meet the following salary criterion:

  • For employees older than 30, the required taxable salary for 2018 must be more than € 37,296.
  • For employees younger than 30 and holding a qualifying master title, the required taxable salary for 2018 must be more than € 28,350.
  • For certain scientific researchers/teachers, no salary criterion applies.

This tax-free allowance is meant to compensate for additional expenses incurred during a temporary stay outside the country of origin (extra-territorial costs). The ruling is only applicable for a maximum period of 8 years. This period will be reduced with possible periods of earlier stay and/or employment in the Netherlands (with exceptions for certain short periods).

Warning: please note it is anticipated that the maximum duration period will be reduced from 8 to 5 years as from 2019. Transitional rules have not been published yet.

The 30%-ruling has certain consequences in terms of social security. Social security rights and premiums may also be affected as these will be based on salary only, thus excluding the 30% allowance. Pension rights, however, can be based on the salary plus the tax-free 30% allowance provided it does not exceed the general maximum pensionable base of euro 105,075 per year for 2018.

If the employee is eligible to the 30%-ruling, the employer can also reimburse the international school fees tax free besides the tax-free 30%-allowance. Furthermore, investment income will -in general- not be subject to Dutch taxation.

The 30% ruling is only applicable if approved by the Tax Administration Authority (Belastingdienst) or a certified tax advisory firm. The employer and employee need to file a joint request to apply for the ruling. The request for the 30% ruling must be filed within 4 months after the start of employment. Requests that have not been filed within 4 months, will not have a retroactive effect from the start date of the employment. In that case, the 30%-ruling will only be applicable as of the month following the date of the request.

For 2018 this form can be used to apply for the 30% ruling. The form for 2018 is not published yet. Make sure both the employer and the foreign employee sign the application.


Additional information 2018 by our Partner LIMES international