Regime Rate
30%
of gross salary exempt from tax
Standard Top Rate
49%
without this regime
Duration
5 years
reduced from 8 to 5 years in 2024
Target Profile
Skilled foreign employees
Netherlands
Tax Savings Illustration
Example: €150,000 Annual Gross Income
Under 30% Ruling
€36,000
Standard Rate
€73,500
Annual Saving
€37,500
Eligibility Requirements
Who qualifies?
- Recruited from abroad — must have lived >150km from the Dutch border in the 24 months before hiring
- Have specific expertise scarce in the Dutch labor market
- Minimum salary: €46,107 gross (2024); €35,048 for under-30 graduates
- Employer must be a Dutch withholding agent
- Apply within 4 months of first day of employment in the Netherlands
How the Regime Works
Full details
Under the 30% Ruling, the employer pays 30% of gross salary as a tax-free reimbursement. Only 70% of salary is subject to Dutch income tax (up to 49.5% + 27.65% social). From 2024: years 1–3: 30% exempt; year 4: 20% exempt; year 5: 10% exempt. The ruling also allows the expat to be treated as a partial non-resident for Box 3 income, potentially exempting foreign investment income. Must be agreed with Belastingdienst in advance.
Regime vs Standard Rates in Netherlands
| Tax Type | Standard Rate | Under This Regime | Saving |
|---|---|---|---|
| Taxable income (years 1–3) | 100% of salary | 70% of salary | 30% tax-free |
| Top income tax rate | 49.5% | 49.5% on 70% | Effective ~34.6% |
| Social security | 27.65% | 27.65% on 70% | Base reduction |
| Box 3 (foreign wealth) | 36% deemed return | Often exempt | Significant for investors |
| VAT | 21% | 21% | Unaffected |
Frequently Asked Questions
Who qualifies for the 30% Ruling?
The 30% Ruling is available to skilled employees recruited from abroad to work in the netherlands. Key requirement: recruited from abroad — must have lived >150km from the dutch border in the 24 months before hiring. The regime lasts 5 years.
How much tax do I save with the 30% Ruling?
On a gross income of €150,000, standard Netherlands income tax is approximately €73,500 (49% top rate). Under the 30% Ruling, it is approximately €36,000 — a saving of €37,500/year. Actual saving depends on income composition and individual circumstances.
How do I apply for the 30% Ruling?
Applications for the 30% Ruling are submitted to the Netherlands tax authority, typically within the first year of establishing residency. You will need proof of prior non-residency, evidence of qualifying activity or income, and valid residency documentation. A qualified local tax advisor is strongly recommended for the application process.
Other Special Regimes to Compare
Disclaimer: This information is for general guidance only and does not constitute tax advice. Tax laws change frequently. Always consult a qualified tax professional before making residency or tax planning decisions.