The 30% ruling is a tax incentive granted to foreign workers, possessing specialist skills, that come to work in the Netherlands. The maximum duration of the ruling for expatriate employees is 8 years.
It is not unusual however for expats to be unaware of their eligibility for this ‘tax break’. The reason may be as simple as not having the time to look into the matter, or perhaps as a result of being unsure of the government regulation. All is not lost however; it is possible to apply for the 30% ruling in the Netherlands even if you have already spent several years working there. Although you may have missed out on some of the benefits, there are still advantages to be had as the tax authorities will reduce the total duration of the ruling by the period you have already resided in the Netherlands.
There is always the case of one’s employment situation changing. There have been incidents where the employer is reluctant to apply for the ruling on behalf of his employee, even though the employee would have been eligible; this can be readdressed. It is also possible for the expatriate employee to reapply for the ruling if he changes employer during the term. Alternatively, the expat may decide to set up his / her own Dutch B.V. becoming an employee of that company and therein be eligible for the 30% ruling. Whatever the circumstances, the ruling exists to incentivize skilled foreign workers to come to the Netherlands; let’s not waste this opportunity!
If you have any questions on the 30% ruling or seek a more detailed explanation on how it effects your tax position in the Netherlands, please contact us at: [email protected]