Dutch tax system
Income tax
Even though the wage tax has already been withheld from the agreed gross salary, the latter is also subject to Dutch income tax.
However, usually you need to pay low or even no income tax because the Dutch wage tax is designed as an advance levy to the Dutch income tax.
To download the (income) tax return program click here (available for Macintosh, Linux and Windows).
Indirect taxes
› Value added tax (VAT)
On the sale price (usually 19%).
› Taxes on legal transactions
On (almost) every refinancing, disposal, acquisition, restructuring or initial public offering.
› Excise duty (or excise tax)
On goods produced and / or sold within the Netherlands.
› Environmental tax
Includes taxes on energy, groundwater, tap water, waste and fuel.
› Consumption tax (non-alcoholic beverages)
On non-alcoholic and "ready-to-drink" beverages.
› Import duties
- Turnover tax: 19%, 0% to 6% of the estimated value of the goods.
- Customs duty: depends on the type of imported goods.
- Excise duty: on alcoholic drinks.
› Tax on passenger cars / motorcycles
On passenger cars / motorcycles / vans either individually or company registered.
› Motor vehicle tax
Depends on the type of vehicle (car, van, motorcycle, lorry etc.), weight and type of fuel. It falls under the environmental tax category.
› Tax on heavy goods vehicles
On lorries used solely for road transportation of goods (through motorways). The amount depends on the vehicle’s axles and its classification (EURO-0, EURO-1 and EURO-2).
› Air passenger tax
Originally introduced as an environmental tax with little or even no effect (purely economic measure). The Dutch government is about to abolish it.
Wage tax
Your tax contribution is deducted from your salary every month, and this is important for expats to keep in mind when discussing the contract terms. There is an essential difference between your gross salary and your actual net after tax income. The income calculator can be found here.
Below you can see how the tax brackets are defined in the Netherlands for persons younger than 65:
› 33% on the first 18.628 euros (1,85% taxes & 31,15% social security contributions)
› 41,95% on the next 14.808 euros (10,8% taxes & 31,15% social security contributions)
› 42% on the next 22.258 euros (tax only)
› 52% on the remainder (tax only)
Direct taxes
› Divided withholding tax
On dividends distributed by Dutch tax-resident companies. Note that it is gradually abolished.
› Inheritance tax Act
- Inheritance tax: on wealth acquired by inheritance from an individual whose properties are in the Netherlands.
- Gift tax: on the value of anything accepted as a gift from a resident in the Netherlands.
- Transfer tax: on wealth acquired by inheritance from an individual whose last place of residence was not the Netherlands.
› Corporate income tax
Applies to companies that are established in the Netherlands and to those that receive income from the Netherlands but are not established here.
› "Games of chance" tax
On prizes more than 454 euros won in any game of chance.
Photo by Flickr user alancleaver_2000
