If you recently moved to the Netherlands for work, you may already know about the Dutch 30 ruling. This tax advantage helps international employees cover extra costs when relocating. However, from 2024, several changes have taken effect. To help employers and expats stay compliant, this article explains the new 30 ruling Netherlands, what has changed, who qualifies, and how it affects those already using it.
What is the 30% ruling Netherlands?
The Dutch 30 ruling is a tax relief scheme for employees who move to the Netherlands for work. It allows employers to pay up to 30% of the employee’s salary tax-free.
This rule aims to help international workers with relocation costs, such as housing and travel, and to attract highly skilled talent to the Netherlands. These tax-free payments cover what the Dutch Tax Office calls “extraterritorial costs.”
What is new with the Dutch 30 ruling?
In 2024, the 30 ruling Netherlands introduced key changes. The benefit now applies for a maximum of five years. Employees who received approval before 2023 can still enjoy the full 30% tax-free benefit for up to five years from their start date. For new applicants from 2024 onwards, the percentage decreases every 20 months:
- First 20 months: 30% of the salary is tax-free
- Next 20 months: 20% of the salary is tax-free
- Final 20 months: 10% of the salary is tax-free
There is also a salary cap, which the Dutch government updates yearly. Employers can now choose between two options:
- Apply the tax-free percentage to the employee’s salary, or
- Reimburse the actual extraterritorial costs tax-free.
Additionally, from 2025, the partial foreign tax liability (partiële buitenlandse belastingplicht) will no longer apply.
Who is eligible for the 30% ruling in 2024?
The eligibility criteria for the Dutch 30 ruling remain unchanged. To qualify:
- The employee must have specific expertise that is scarce in the Netherlands.
- They must have been recruited or transferred from abroad and lived at least 150 kilometres outside the Dutch border for 16 of the 24 months before employment.
- They must earn a salary that meets the minimum taxable income set each year by the Belastingdienst.
Do you already have the old 30% ruling Netherlands?
If you or your employees already benefit from the 30 ruling Netherlands, here’s what to keep in mind:
- The ruling now has a five-year limit. For example, if it began in 2020, it ends in 2025.
- Employees who received the benefit before December 2022 will not face the new remuneration cap until 1 January 2026.
- Transition rules apply depending on when the 30% ruling began. It is advisable to consult a tax expert for personalised advice.
Partner with Octagon Professionals
Understanding and managing the Dutch 30 ruling can be complex. As an Employer of Record, Octagon Professionals supports companies and expats through every step.
Our team ensures compliance with Dutch tax law, manages administrative tasks, and helps international employees settle smoothly in the Netherlands. Let us handle the formalities while you focus on business growth. Contact us today to learn how we can simplify your global expansion and workforce management.
