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30% ruling in the Netherlands to be shortened in 2019

30% ruling in the Netherlands to be shortened in 2019

On October 10, 2017, the Dutch government announced its plans for the future. These plans detailed a shortening of the 30% ruling for expats from eight years to five. The government is now planning to enforce this change per January 1, 2019.

30% ruling in the Netherlands

The 30% ruling is a tax advantage for highly skilled migrants working in the Netherlands. The ruling allows employers to offer 30% of an employee’s salary to them tax-free, meaning that the employee only pays tax over 70% of their gross Dutch salary.

The tax break that highly skilled migrants in the Netherlands receive is meant as a reimbursement for the costs incurred when relocating to the Netherlands, such as travel costs, costs for visas and housing costs, to name a few. The 30% ruling is coordinated by the Dutch tax office (Belastingdienst).

This tax advantage was put in place to attract specialists from other countries who have particular expertise which is either not available in the Netherlands or is scarce.

Changes to the 30% ruling

According to a 2017 evaluation of the 30% ruling by research bureau Dialogic, 80 percent of employees receiving the 30% tax advantage do not make use of it for more than five years. The majority of the 20 percent who did take advantage of the 30% ruling for eight years took up long-term residency in the Netherlands.

The Dutch government announced plans to shorten the 30% ruling from eight years to five in its “Confidence in the Future” document. The shortening of the term of the 30% ruling will come into effect on January 1, 2019.

This change will apply to both newcomers applying for the ruling and those already receiving the tax advantage. The government plans on including the changes to the 30% ruling in the 2019 tax plans that will be disclosed on Prinsjesdag.

Mina

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Mina Solanki

British girl living in the Netherlands, enjoying the sun *coughs*, I mean rain, and filling her time with adventures.

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COMMENTS

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Dor Kedem 08:29 | 24 April 2018

I came in 2014, and in 2015 I took a mortgage based on my 30% ruling salary. If I had known I might have taken a smaller place / changed mortgage composition. Now they effectively tell me next year to expect roughly 20% drop in my net income. This is really not ok. I thought that if I had a signed legal document stated the benefit until year 2022, with the government signature on it, it's legally binding... At least my mortgage provider seemed to think so.

Ad Àm 21:36 | 24 April 2018

I'm very confused as to the legality of this.

Anatoly Chernenko 11:51 | 26 April 2018

Agree. Please sign if you think it's not fair. https://www.change.org/p/dutch-government-should-not-break-existing-contracts-keep-the-trust-with-expats

Masoom Tulsiani 14:02 | 26 April 2018

Completely agree with your Dor. :)

kkupe 10:37 | 24 April 2018

This is crazy. I agree with Dor, most people did plans by trusting the rule. If it had only for newcomers, it'd be ok but it's not acceptable for people who are already receiving the tax advantage. This means every "legal" document can be changed by the government in future! We should do something!

Pulkit Gupta 10:07 | 24 April 2018

I am exactly in the same situation as Dor Kedem is in. This is completely illogical to change it for the existing ones. I bought the house last year based on my net salary and a long calculation for the next few years, I know many people who have refused job offers from Germany and other countries after the net salary calculation based on 30% ruling. Government should look into it and amend this new change for the existing beneficiaries.

Cyril Courel 10:13 | 24 April 2018

It's total shame, that cannot happen. We have contracted mortgages, expenses, etc. based on the assumption that we have it for 8 years.

alejandroh 10:30 | 24 April 2018

I am in the same situation and this really shocked me. This contradicts the acquired rights doctrine: "the legal principle that an immediate, fixed right cannot be limited by later laws passed by the government. The acquired-rights doctrine suggests that a change in the supreme power in a country cannot affect the interests of individuals" This already happened in 2012 when they decreased the application period of the 30% ruling from 10 to 8 years. Back then, the government developed transitional law for 30% rulings granted before 2012. It made possible for 30% rulings granted before 2012 to still take the 10 years

kkupe 10:39 | 24 April 2018

I hope this time will be same.

jeangul 10:53 | 24 April 2018

But why its effecting the existing ones? A gained right cannot be taken by passing a bill retroactively. Signed up for a mortgage depending my 30% ruling salary is valid until 2022; and with this, I lost my 20% net income... this will really put people in difficult position; totally insane.

Pyco Withdears 12:16 | 24 April 2018

I don't get what Minister of Finance and the Gurus around have in mind for real!!! All future qualified potential new workers from abroad will be scared from now on of loosing overnight rights, benefits and basic confidence they will make it in NL (yes, this is a nice but very expensive country to live in, especially when you cannot count of nearby supporting family). There will be more double thought and rejection of offers I can anticipate. They are (sorry, cannot find effective enough words in the dictionary) screwing us but after all we are relatively "few", more than that they are jeopardizing the National growth... this is a small Country, not all can be homegrown!!! What is really at stake to me is the trust in The NL from abroad, and that is big business!!!

Natasha Lut 12:30 | 24 April 2018

Dear Colleagues, Unfortunately I also have to join the Club: I have got a mortgage... My offer is to team up and may be hire a lawyer together for a collective application to court otherwise we can expect other "surprises" soon from the government changing the law backwards.

Vassilis Pits 13:23 | 24 April 2018

I would like to participate in a collective application against the retrospective effect of this planning.

Penny Lam 14:09 | 2 May 2018

Please count me in too! I also have signed a mortgage in 2015 when I came NL. The 30% ruling will be finished in less than 2 years. And I will become a father soon .... I even fear that the new comers has made a planed with 5-year 30% ruling, then being cut to 2-year or zero suddenly. How could people trust on the 30% ruling further??!!

ariciu17 13:55 | 24 April 2018

I will join you! I'm in the same situation unfortunately

dh 14:23 | 24 April 2018

Count me in! Please share thoughts / details on how I /we can help.

Lily Kollé 15:53 | 24 April 2018

I'm in. There is no way this is legal. We should at least petition for the same transitional provision they allowed in 2012 for expats with existing 30% rulings.

Godmother Phang 16:06 | 25 April 2018

I'll join too. Unfortunately im in the same situation.

MuhammadWasif 11:52 | 26 April 2018

I'm in too, let me know how can i contribute

elroboot 13:04 | 24 April 2018

I'm on the same boat! I completely agree that it is "not fair" that new rules can have effect retroactively for matters like this. I checked the letter I received with the decision in relation to the ruling. I don't speak Dutch but I would assume this google translation says it all. "...is geldig onder voorbehoud van wijziging in wet- en regelgeving" " ...is valid subject to changes in legislation and regulations". I really hope that is not decisive.

jayhen 13:07 | 24 April 2018

This is truly abominable behaviour from the Dutch government. I agree with all of the points made already in the comments. Any prospective expat will not place reliance on the new 5 year ruling. The Dutch are within their rights to change the term going forward, but to change the rights already in existence is disgusting. It ruins the lives of people who are here because they contribute to the economy and help it to grow. I also agree that there needs to be a collective resistance. Part of this problem was that there was weak lobbying on behalf of the expats. No one cared.

nik78 13:23 | 24 April 2018

I am also sailing the same boat. Bought property 4 months ago based on understanding that ruling is there for 8 years. It's significant reduction and would severely impact financial condition for me. If there is some initiative to challenge this as a group, please count me in.

Siddharth Chunduri 13:33 | 24 April 2018

How can we make ourselves heard in the hague, if there are enough voices they might spare existing users. This has serious implication for those with mortgages, debts etc.

Juno 13:56 | 24 April 2018

Hello All, Great to see so many people commented on the Friday news! The more we are, the stronger we can be! What will be best though is, instead of just adding people to the boat of complaints about unfairness - to take action from NOW until September when the definitive decision will be presented. My suggestions will be: 1. Contact IamExpat web-site administration or any other official body that can support the Expat community in raising the issue. 2. Create a thoughtfully written and well-described PETITION explaining what our demand is (not to apply the regulation changes retroactively to existing 30% rule holders) 3. Share the link to the petition with all our expat friends and their spouses/family/friends. The impact is not only on us but also on the people in our life. 4. Have a talk with a lawyer who can represent the Petition owner and the overall demand in front of Government organizations through official steps of communicating this. I would have taken some of these tasks myself going forward but, I am due soon and would be best a person with more energy and time to start actioning the topic. Full text of the law and the evaluation report can be found here: https://www.rijksoverheid.nl/actueel/nieuws/2018/04/20/fiscale-regeling-voor-buitenlandse-werknemers-verkort-naar-vijf-jaar And hopefully, our voice can be heard!

dh 14:25 | 24 April 2018

Just obtained a mortgage and will be hit with 20% income reduction in 8 months. This is a very difficult predicament. :(

Praveen Pujari 07:33 | 25 April 2018

I just got mortgage and moved into new house, accidentally came across this shocking thread regarding 30% ruling. Would really affect us all.

alejandroh 15:05 | 24 April 2018

Join the facebook group to follow the discussion with more people in the same situation: https://www.facebook.com/groups/1772227519465342/?hc_location=group

Lily Kollé 16:18 | 24 April 2018

Just started a petition, let's get this law changed! https://www.change.org/p/iamexpat-transitional-law-for-30-rulings-granted-in-2014-and-earlier?recruiter=872328286&utm_source=share_petition&utm_medium=copylink&utm_campaign=share_petition&utm_term=share_for_starters_page

Anatoly Chernenko 12:03 | 26 April 2018

https://www.change.org/p/dutch-government-should-not-break-existing-contracts-keep-the-trust-with-expats

b 16:49 | 24 April 2018

I am also in the same situation. I started in 2015 and my boyfriend in 2014 and we bought a house and made plan based on a 8 year benefit. Is there any expat association that we could contact/join to "protest" on this plan? I do not understand why they want to apply it to 'old" expat when even NS subscription is practically forever.

thisism 17:42 | 24 April 2018

There are 2 petitions on Change.org - please go and sign.

ariciu17 19:01 | 24 April 2018

What's the URL for them?

sylwiabis 10:06 | 25 April 2018

Can`t find it , could you provide URL?

Anatoly Chernenko 12:09 | 26 April 2018

https://www.iamexpat.nl/expat-info/dutch-expat-news/30-ruling-netherlands-be-shortened-2019?mc_cid=53c537f870#_=_

Fatima HT 11:49 | 25 April 2018

https://www.change.org/p/iamexpat-transitional-law-for-30-rulings-granted-in-2014-and-earlier?source_location=search_index&algorithm=promoted&original_footer_petition_id=&grid_position=1&pt=AVBldGl0aW9uAJ2RyAAAAAAAWuBQGcgatMcyNTk3MzMyOA%3D%3D

Anatoly Chernenko 12:04 | 26 April 2018

I signed this one https://www.change.org/p/dutch-government-should-not-break-existing-contracts-keep-the-trust-with-expats

john78 18:00 | 24 April 2018

I am also one of those affected by the change in the law and i am thinking of the options. The government clearly wants more money to finance their expensive projects. Holders of the 30% are highly likely non-voters for the government so an easy group to take money from (and give to a group of voters). I hate to think that the Dutch government will start thinking like that but if i cannot trust the government i have to move somewhere else where i can (and where my skills are also appreciated).

Chirag Shah 22:51 | 24 April 2018

Interested people can join the fb group: https://www.facebook.com/groups/1939071639445979 People can also sign the below petition: https://www.change.org/p/dutch-ministry-of-finance-don-t-screw-over-expats?recruiter=639156329&utm_source=share_petition&utm_campaign=psf_combo_share_initial&utm_medium=whatsapp&utm_content=whatsapp_share_content_2:control In addition, we should also regiter our individual concern to ministry of finance via: https://www.rijksoverheid.nl/contact/contactformulier

Akshay Wani 20:46 | 24 April 2018

Where r the people who asked expats to vote for a local political party during recent muncipal elections where r they now and whats their stand

Panos Van Griekse 21:44 | 24 April 2018

Apart from hiring a collective lawyer I think it is wise that we contact our companies and their lawyers so as to express our frustration and ask them to take responsibility on this. In many cases, as stated before, expats moved to the country mainly by this tempting exception. Otherwise we could have stayed in our sunny countries :)

GeoG 12:13 | 25 April 2018

Do you think it is, technically speaking, illegal? I doubt that the bureaucrats in the Ministry are that naive. They found a loophole and they cut our benefits. Since you come from Greece, you should know that EU (and consequently NL) has no problem at all imposing retroactive application of such rules and laws without any notice.

Massimiliano Longhin 12:35 | 1 August 2018

You should just be thankful that you ave received such a luxury treatment all these years instead of complaining

ERadelaar 22:09 | 24 April 2018

As a Dutch HR professional, i have just read the new law. I would like to explain that the new maximum of 5 years will be introduced as of January 1, 2019. All expats currently making use of the 30% ruling and all new approved applications until January 1, 2019 are for the duration of 8 years. If you currently have the 30% tax benefit nothing changes for you. Hopefully this information is helpful.

Diego Alvarez 23:06 | 24 April 2018

Are you sure? When I look to all the articles it says to existing and new cases. https://www.rijksoverheid.nl/documenten/kamerstukken/2018/04/20/kabinetsreactie-evaluatie-30-regeling

Praveen Pujari 08:39 | 25 April 2018

That indeed helps alot, but are you sure ? Thanks

a_h 09:27 | 25 April 2018

Dear ERadelaar, I hope what you say is true, but when reading the article with my poor Dutch, I understand it applies to both new and existing cases. https://www.rijksoverheid.nl/documenten/kamerstukken/2018/04/20/kabinetsreactie-evaluatie-30-regeling What do you think?

alejandroh 11:47 | 25 April 2018

Mr/Mrs. "Dutch HR professional", please do not confuse people. In the text it clearly mentions that also affects existing cases: "Concreet betekent dit dat het kabinet in het pakket Belastingplan 2019 zal voorstellen de maximale looptijd van de 30%-regeling met ingang van 1 januari 2019 voor zowel nieuwe als bestaande gevallen met drie jaar te verkorten"

Fatima HT 11:47 | 25 April 2018

The person in charge of the 30% ruling application in my institution said that this is a suggestion and the final decision will be made towards the end of the year. Is that correct? He also said that they are trying to negotiate with the government to make an exception for the existing employees. I think it might be helpful if we all send letters to the government or the MPs and explain how we made our decisions based on the 8-year plan and that we should be exempt from it. This could put pressure on the government.

GeoG 12:09 | 25 April 2018

In any case this puts a huge amount of uncertainty on us. I doubt the geniuses at the Ministry care about us. Recently, I accepted a new contract offer form my employee turning down another offer with 60% more money (without taking into account the 30% which will expire in less than 3 years on my case). I really want to resign right now, what is the point if people play such games behind my back?

Fatima HT 12:04 | 25 April 2018

Sign the petition: https://www.change.org/p/dutch-ministry-of-finance-don-t-screw-over-expats?recruiter=872330206&utm_source=share_petition&utm_medium=email&utm_campaign=share_email_responsive&utm_term=triggered&expired_session=true

ariciu17 19:09 | 25 April 2018

This doesn't look promising... https://www.dutchnews.nl/news/2018/04/no-transition-period-for-expats-hit-by-30-ruling-cuts-ministry-says/

Salvatore Panno... 03:21 | 26 April 2018

if this application of the law is retroactive it will be an abuse and I think many people will leave

john78 13:27 | 26 April 2018

I know I will.. Already started looking for jobs.. Can't trust this government. Maybe tomorrow they want back all the money we got using the 30%..and lack of trust is bad for the economy.pity..

Anatoly Chernenko 11:53 | 26 April 2018

Please sign petition below if you think this is not what you want https://www.change.org/p/dutch-government-should-not-break-existing-contracts-keep-the-trust-with-expats

Irene Lim 14:14 | 26 April 2018

If you have already got the 30% ruling approved before 2018, the existing conditions are still valid. You continue to get the 30% ruling for 8 years. Only those who applied in 2019 will get 5 years.

Shiplu Mokaddim 18:55 | 26 April 2018

Are you sure about it? In https://www.dutchnews.nl/news/2018/04/government-to-cut-time-limit-for-30-rule-from-next-year/ it is clearly stated in the first paragraph "The new time limit will apply to new and existing beneficiaries of the tax break, the finance ministry said"

roza1000 22:15 | 28 April 2018

Dear Irene, Unfortunately you are wrong! Government proposing retrospective changes. Please read the proposal.

Gerry Williams 16:33 | 3 May 2018

Wrong

aw2xcd 10:57 | 27 April 2018

Anyone know why they are doing this? Netherlands is one of the fastest growing economies in EU so I'm struggling to understand why other than it's a big f you to all the migrants and the dutch way of saying we don't want you here. Never felt more unwelcome in another country before. Can't wait for someone to ask me how my dutch is going.

Marc111 14:07 | 28 April 2018

Last time they cut from 10 to 8 years, but applied to newcomers only. Applying something retroactive is not fair, and yes, tomorrow they can say 'my way or the highway' for anything. They mentioned some research showing that 80% of expats leave country after 5 years. If I decide to stay longer that 5 years and would like to receive bigger pension one day, I will give up 30% by my will.

Ken Miller 11:46 | 1 May 2018

In the same boat as lots of other folks posting here--just bought an apartment and took my mortgage based on assumption of 30% ruling lasting the full 8 years. Seems punitive to impose change retroactively; normally changes in law are prospective, applying to new cases moving forward, not to those already receiving a certain benefit. This is harsh and will cause hardship for a lot of expats.

Ozzie 03:56 | 25 May 2018

I am an Australian professional caught up in this mess. From early last year, a Dutch company and myself have been working on getting me to come and work in NL as the company does not have the skills that I posses. We agreed on all remuneration and "other" details and I have even sold my house in AU but because all these issues take time to do in an orderly manner it has taken more than 12 months. However, the Dutch government in its wisdom changed the rules. I have now told the Dutch company that I am going to reconsider their offer and will (99.9%) likely be turning them down! When you have a family all these matters take a lot of time. My kids had to sit entrance exams for the "international schools;" I have paid significant deposits for the kids schooling, My wife and I made a trip to NL to look for housing as we were going to buy. This is such an utter mess from politicians that live in a bubble and have no idea of the implications to the "average" person. Simply unacceptable and I never expected this from a country like the Netherlands. I have worked in many countries around the world but I suspect that I will be "black balling" NL given such short sighted decision making. The Dutch company and I had worked with the assumption of "8" year ruling as having kids I can not be dragging my kids from country to country; We need long term certainty. In any case NL will miss out; their loss not ours! I am not prepared to take a risk because there is no guarantee that 5 years will become 3 or even 2. I say to current & potential expats; "black ball NL."

andy338 18:14 | 26 July 2018

I have been benefitting from the 30% ruling for several years and it really makes a difference! If my Belastingdienst correspondence is anything to go by, mine was due to run until Feb 2020, so any shortening of the eligibility period is going to hurt - even though I don't have a mortgage here. I have read a lot in the posts above about protesting and legal action, etc. but realistically can we do anything to stop it? I know it will deter highly skilled professionals from coming to this wonderful country - is that what they really want???

srag 14:19 | 6 August 2018

Hi All, I have got 30% ruling benefit for 5 months in the year 2013. After that i moved into my native country. I came again Netherlands in 2016 and applied for 30% ruling. I got that benefit from 1 Feb 2016 till 31-7-2023 (as per 30% ruling approval letter). Now they are going to change to 5 years from 1st Jan 2019. My understanding that i will get that benefit till 31-7-2020. Is that correct? Or my 30% ruling completed in 2018 itself. Please clarify.