Patricia van der Hut is partner at Finsens. Finsens is specialized in rendering services to expats i...
Dutch Tax: Frequently asked questions about the 30 percent ruling18 December 2013, by Patricia van der Hut
As of 2012, the requirements for the 30 percent ruling have been changed, with some requirements being added and others becoming less important. Further, there are specific transition rules for those who were already benefiting of the 30 percent ruling prior to 2012.
Due to these changes, many expats are unaware whether they are still eligible for the 30 percent ruling or if these new rules affect their current 30 percent ruling. We have gathered the most frequently asked questions we have had over the past couple of months.
Is the 30 percent ruling only applicable if my gross salary is more than 51.100 euros?
No. The salary requirement under the 30 percent ruling is a minimum taxable wages of 35.770 euros. As long as your taxable salary is more than 35.770 euros, the ruling is applicable on income exceeding 35.770 euros, with a maximum of 30 percent of the taxable income, of course.
I now benefit from the 30 percent ruling but I want to work for a different company - can I transfer the ruling?
Yes, you can switch employers and continue the 30 percent ruling with your new employment. You and your new employer will need to submit a new application for the ruling, however. The gap between your previous job and the new one cannot be more than three months.
I meet all the conditions for the 30 percent ruling, but my employer is not willing to submit the application. Can I submit the application myself?
No, unfortunately not. The employer and the employee need to apply jointly. If the employer does not want to apply for the 30 percent ruling, the employee is not entitled to receive this benefit.
Can I apply for the 30 percent ruling if I was a student in the Netherlands?
It depends whether or not you were considered as a Dutch resident during your studies. If you came to the Netherlands only for your studies and the centre of your social and economic life was outside the Netherlands, then you may not be considered Dutch resident. In this situation, you may be eligible for the 30 percent ruling if you meet the other requirements for the ruling.
If you came to the Netherlands for a PhD, and have secured a job after finishing the PhD, you will also be considered as being hired from outside.
Can I apply for the 30 percent ruling if I have lived in the Netherlands before?
Yes, that is possible. The years spent in the Netherlands will be deducted from the maximum duration of the 30 percent ruling (eight years).
For example, if you have lived in the Netherlands for three years previously, and you come back to the Netherlands again, you will be eligible for the 30 percent ruling for five more years.
Is the 150 km restriction applicable?
The High Court in the Netherlands asked a prejudicial question about the 150 km requirement, as there are doubts whether this ruling is in accordance with EU law.
This requirement will change if the High Court of Justice judges that it is not compatible with EU law. It might affect rulings which were denied on the basis that the 150 km requirement was not met.
Can my partner benefit from the 30 percent ruling?
Your partner cannot benefit from the 30 percent ruling on income. However, under the 30 percent ruling you are exempt for box 3 (tax on your savings and investments).
If you and your partner are fiscal partners, your partner can allocate his/her savings to you and then these savings will not be not taxed either.
I began working for a company in the Netherlands a while ago and only just found out about the 30 percent ruling. Am I still able to apply for it?
Yes, that is possible. The 30 percent ruling needs to be submitted within four months after the commencement date of your contract in order to receive the ruling retroactively.
If the four months period has passed, you can still apply for the 30 percent ruling, but the commencement date will then be the month following the submission date.
What does the transitory period mean under the old legislation from before January 2012?
If you received the 30 percent ruling before January 2012, you are subject under the old rules for a period of five years after the date of granting.
After these five years, you will have to meet the new requirements, which means your taxable salary should be more than 35.770 euros and you must have lived more than 150 km away from the Dutch border prior to your arrival in the Netherlands.
If you do not meet these conditions, the 30 percent ruling will no longer be applicable.
What happens if the 30 percent ruling was applied incorrectly?
At the end of the year the tax authorities will check if employees have met all the requirements.
If it turns out that, for example, the minimum salary requirement was not met, the 30 percent ruling was applied incorrectly.
As a consequence, the employer will face an additional tax assessment payroll tax. The employer is allowed to pass on these costs to the employee.
Patricia van der Hut is a partner at Finsens, specialists in rendering services to expats in the areas of tax, mortgages and investment advice. For more information, please comment below or contact them directly.