The transition period for ‘old’ 30%-ruling holders will end per the end of this year. This means that many employees will lose the 30%-ruling per January 1, 2021. We are happy to explain the most important tax consequences and tax planning opportunities.
Hopefully, the Corona measures that the Netherlands and the rest of the world are taking will be effective enough to also deal with the financial consequences of this pandemic. Some of these measures do not directly relate to tax, but they do have immediate tax and social security consequences. Even though this might not be your first point of concern, it is important to keep this in mind.
The Court of Appeal in Amsterdam decided in October 2019 that an individual who was hired from abroad is still eligible for the 30%-ruling after having lived in the Netherlands for more than two years.
At the end of October 2018 the text of the new proposed transition legislation has been published regarding the decrease of the 30% duration from 8 to 5 years per next year.
Moderately good news for many expats that felt justifiably cheated by the Dutch government since their 30% tax ruling duration was about to be shortened from 8 to 5 years on the 1st of January 2019 without any transition period. Now, the plan is that existing cases get a transition period anyway.
Our government intends to reduce the duration of a tax scheme for expats, the so-called 30% ruling, from eight to five years as of January 1, 2019. The unfairness of this proposal lies in that this decrease to 5 years will apply to both new and existing cases.
Het kabinet is van plan om de looptijd van een fiscale regeling voor expats, de zogenoemde 30%-regeling, per 1 januari 2019 te verkorten van acht naar vijf jaar. Het oneerlijke van dit voorstel is dat de verkorting gaat gelden voor zowel nieuwe als bestaande gevallen.
To avoid tax risks, it is important to check the 30%-ruling for employees lived within 150 km from the Dutch Border. Employees to whom the 30%-ruling was granted before 2012 have to meet the 150 km border criteria after 5 years!
The new Dutch government plans to reduce the duration of tax break for expats known as the 30% ruling with 3 years (therefore with 37.5%!), according to the coalition agreement published on 10 October 2017.
Some 60,000 people currently claim the tax break, which effectively means they do not pay tax on the first 30% of their salary. Indian nationals are the most likely to use the ruling, followed by British, American and Italian expats.
When you relocate to the Netherlands and planning to set up your own business you have to make sure that you are organized well in order to structure your finance and tax obligations properly.
What are the options to work as an entrepreneur in the Netherlands? And what additional tax-benefits can you get as a new resident and entrepreneur in the Netherlands?