The 30% reimbursement ruling (better known as the 30% ruling) is a tax advantage for highly
skilled migrants moving to the Netherlands for a specific employment role. When the
necessary conditions are met, the employer can grant a tax free allowance equivalent to 30%
of the gross salary subject to Dutch payroll tax.
Applying for the 30% ruling
The 30% ruling is equivalent to a maximum (effective) tax rate of approximately 36.4%. The
resulting tax free allowance is considered compensation for expenses that a foreign employee
experiences when working outside their home country.
What does the 30% ruling mean to you?
From a tax perspective, the salary agreed upon between the employee and employer may be
reduced by 30%. In return, the employee should receive a 30% reduction as reimbursement for
expenses. This is the most common way it is applied as it does not influence the salary burden
for the employer. However, the employer is not obliged to pass on the advantage of the ruling
to the employee. In practice the employer can partially or fully take the benefit.
In order to be eligible for the 30% ruling the following conditions have to be met:
1. The employee has to work for an employer
2. The employer and employee have to agree in writing that the 30% ruling is applicable
3. The employee has to transfer or be recruited from abroad to a Dutch employer
4. The employee has to have specific experience or expertise that is not or is rarely
available in the Netherlands
5. The gross annual salary has to surpass a minimum limit (adjusted annually) As of 1
January 2014, the gross annual salary has to be at least €36,378. However, a lower salary
of €27,653 is applicable for those who have completed a Master’s degree and are
younger than 30 years old.
Another benefit that not a lot of people know about is that if you benefit from the 30% ruling,
you can switch your foreign driving license without retaking the test.
(Source: I Amsterdam)
Please contact expatsHaarlem Work Services if you’d like to find out more about the 30% ruling.