What PhD graduates should know about the 30 percent ruling

What PhD graduates should know about the 30 percent ruling

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De Vreede Advocaten is a young and dynamic law firm specialised in immigration and international employment law for both businesses and individuals.

The Netherlands has a favourable tax ruling for employees hired from abroad called the 30 percent ruling. If certain conditions are met, the employee may receive 30 percent of their salary tax-free.

One of the most important conditions, apart from the salary level, is that the employee is hired from abroad. 

The 30 percent ruling and PhD students

Often this condition leads to discussions with the Dutch tax authorities, particularly in cases where a student has come to the Netherlands to study and is, subsequently, hired by a local Dutch employer.

The Dutch tax authorities often take the position of interpreting that the student or employee does not qualify because they were already in the country when they were hired. 

However, for PhD students who completed their PhD in the Netherlands, the requirement of being recruited from abroad does not have to be met if they are hired within one year of completing their studies.

A PhD example in the Netherlands

Before coming to the Netherlands to complete his PhD, Donald was living in the USA. He came to the Netherlands in January 2016 and finished his PhD in March 2017.

After finishing his PhD, he started looking for a job in the Netherlands, and managed to finally find one in January 2018.

Although he has been living in the Netherlands for two years he was still able to obtain the 30 percent ruling for the full 8-year period providing, of course, that he met the other criteria required for the ruling.

Other students do not benefit

Other students cannot benefit from this exception to the rule. In their situation, it depends whether or not the student is considered a Dutch resident during their studies.

Whether or not a person is regarded as a tax resident of the Netherlands depends on all facts and their circumstances.

If the student came to the Netherlands for their studies only and the center of their social and economic life was outside the Netherlands during the study, then they may not be considered Dutch resident.

In such a situation, they may be eligible for the 30 percent ruling if they meet the other requirements.

For these students, it is therefore important to carefully determine their personal situation in order to qualify for the 30 percent ruling.

Your situation determines your status

Mary, who came from India to study at a business school in the Netherlands, is an example of how ones situation can determine whether one qualifies for the 30 percent ruling.

Upon finding a place to stay, so she could continue her PhD, Mary registered at the municipality, which for the Dutch tax authorities automatically meant that she became a tax resident of the Netherlands.

She was only allowed to study in the Netherlands on a student visa, which was granted for one year. After that year, she obtained her diploma and went back to India for a duration of six weeks over the Christmas holidays.

In that 6-week period, she found a job in the Netherlands and applied for the 30 percent ruling. Of course, the tax authorities denied the request arguing that she was not hired from abroad.

Based on the facts and circumstances of this particular case, for example, the fact that she still had close connections, both financial and personal, to India, and her initial intention was to stay in the Netherlands temporarily, De Vreede was able to convince the tax authorities that she was in fact hired form abroad.

Legally speaking, the intention would only change from the moment she signed an employment contract with the Dutch employer to indicate that she had come to work and live in the Netherlands, thus becoming a resident.

De Vreede Advocaten is happy to answer any 30 percent ruling queries you may have.

De Vreede Advocaten


Ester de Vreede


Ester de Vreede

Ester combines an extensive knowledge of employment law and immigration law, which proves to be an asset and of specific interest for highly skilled expats and companies that employ them....

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