What is the 30% ruling?
The 30% ruling a special cost reimbursement scheme for employees from abroad who do not have to pay tax on 30% of their taxable income if certain conditions are met. This reimbursement scheme was devised to make it easier for employers to grant a tax-free allowance to employees from abroad who have come to work in the Netherlands.
If an employee is eligible for the 30% ruling, then they no longer qualify for reimbursement of any additional expenses – so-called extraterritorial costs – they incur. These costs include double accommodation costs, hotel costs and family visits, provided that the actual extraterritorial costs in a tax year do not exceed the 30% allowance. The application must be submitted to the Dutch Tax and Customs Administration (Belastingdienst) within four months of commencing employment.
To be able to use the 30% ruling, the employer and the employee must submit an application to the Dutch Tax and Customs Administration. The Dutch Tax and Customs Administration will then assess whether the following conditions are being met:
- The employee was recruited outside the Netherlands. Or has been seconded to work in the Netherlands;
- The employee is registered in the Netherlands and is on the employer’s payroll;
- The employee can add something to the Dutch economy (in the case of highly skilled migrants this will almost always apply);
- The employee must meet the current annual salary requirements;
Should you choose to use the services of Com.pas, then we will handle the application and implementation of the 30%-ruling. If you would like to know what the net salary or the cost price will be, please get in touch with us without any obligation.