30% ruling

The 30% ruling is a tax measure available under certain conditions to staff from abroad and staff who are seconded from the University. Your HR department will deal with your request to apply the 30% ruling, but it is the Dutch Tax Administration that decides whether you qualify.

30% ruling for staff from abroad

The essence of the ruling is that 30/70ths of the basis for payroll tax can be provided as a tax-free allowance for extraterritorial expenses; these are expenses that are incurred for the temporary stay in the Netherlands. In order to qualify for this allowance you must possess expertise that is not available or is scarce supply on the Dutch labour market.

Further information about the extraterritorial expenses and the terms and conditions can be found on the website of the Dutch Tax Administration.

Consequences for the member of staff
You benefit from the application of the 30% ruling but should be aware of possible consequences. The application of the 30% ruling reduces your gross salary, which has consequences for your pension basis and possible benefits/allowances (e.g. Unemployment Act (WW) and housing benefit). Furthermore, once the decision of the Dutch Tax Administration expires, the basis for awarding the tax-free allowance expires and a fall in net income can result.

Procedure
In order to be able to apply the 30% ruling you need the permission of the Dutch Tax Administration. You should submit a request, together with your employer.

Request to apply 30% ruling to payroll tax Relationship of the 30% ruling with other tax rulings
Alongside the 30% ruling, you can also qualify for tax-free expense allowances that are not related to the extraterritorial expenses. An example of this type of allowance is the general travel expenses allowance and a possible additional travel expenses allowance on the basis of the terms of employment individual choices model (given that this relates to the allowance for travel expenses between your work address and home address in the Netherlands).

30% ruling for staff seconded abroad

Staff who are seconded abroad for academic work or teaching may qualify for the 30% ruling.

You can find further information about the conditions on the website of the Dutch Tax Administration.

You may benefit from the application of the 30% ruling but should be aware of possible consequences. The application of the 30% ruling reduces your gross salary, which has consequences for possible benefits/allowances (e.g. Unemployment Act (WW) benefits and housing benefit).

All untaxed expenses together that result in  a reduction of the gross salary may not amount to a total amount of more than 30% of the standard, contractual gross salary . Application of the 30% ruling therefore also has possible consequences for your choices within the terms of employment individual choices model.

30% ruling for Marie Curie Fellows

As a research fellow you can determine yourself what is most favourable for you: payment of allowances or application of the 30% ruling (if the conditions set by the Dutch Tax Administration are met). Your HRM department can help you with your decision. If the 30% ruling is requested for a research fellow and awarded by the Dutch Tax Administration, the extraterritorial expenses may no longer be paid untaxed.
Alongside the 30% ruling, you may also qualify for tax-free expense allowances that are unrelated to the extraterritorial expenses. An example of this type of allowance is the general travel expenses allowance and a possible additional travel expenses allowance on the basis of the terms of employment individual choices model (given that this relates to the allowance for travel expenses between your work address and home address in the Netherlands).

For further information see: Marie Curie Actions fellowships - How to manage my project - ITN .

Last Modified: 13-04-2016