Netherlands 30% Ruling 2025: Complete Guide for Expats - Eligibility, Application, and Tax Benefits

Netherlands 30% Ruling: Complete Guide for Expats 2025

The Netherlands 30% ruling (30% regeling) is one of the most attractive tax benefits available to expatriates in Europe. This special tax facility allows eligible foreign workers to receive 30% of their gross salary completely tax-free for up to five years, significantly reducing their overall tax burden. The ruling was designed to attract highly skilled international workers to the Netherlands by offsetting the extra costs of living abroad, such as higher housing costs, travel expenses, and adjustment costs. Understanding how to qualify for and maximize this benefit can save expats tens of thousands of euros over the five-year period.

Eligibility Requirements for 30% Ruling

To qualify for the 30% ruling, you must meet all of the following strict requirements: You must be recruited or transferred from abroad (not already living in the Netherlands). You must have specific expertise that is not readily available in the Dutch labor market - this is assessed based on salary level and qualifications. You must have lived more than 150 kilometers away from the Dutch border for at least 16 of the 24 months before starting work in the Netherlands. Your employer must be registered as a Dutch employer (or have a permanent establishment in the Netherlands). You must have a valid employment contract or assignment letter. The specific expertise requirement is typically met if your gross salary meets the minimum threshold after applying the 30% reduction. These requirements ensure that the ruling is only available to genuine international hires bringing valuable skills to the Netherlands.

Minimum Salary Requirements

The minimum salary requirements are crucial for eligibility. After applying the 30% tax-free allowance, your remaining taxable salary must meet: €46,660 per year for standard applicants (approximately €66,657 gross before the 30% reduction), or €35,468 per year if you're under 30 years old and hold a master's degree (approximately €50,669 gross before the 30% reduction). These thresholds are adjusted annually for inflation. Meeting these minimums demonstrates that you have "specific expertise" that qualifies for the ruling. If your salary doesn't meet these thresholds, you cannot qualify for the 30% ruling, regardless of other requirements.

Application Process

Your employer must apply for the 30% ruling on your behalf within four months of your first working day in the Netherlands. The application is submitted to the Dutch tax authorities (Belastingdienst) using a special form. Required documentation includes: your employment contract or assignment letter, proof of residence outside the Netherlands (tax returns, rental agreements, etc.), evidence that you lived more than 150km from the Dutch border, educational certificates proving your expertise, and salary information demonstrating you meet minimum thresholds. The tax authorities typically respond within 6-10 weeks. If approved, the ruling applies retroactively from your first working day, meaning you may receive a refund for taxes already paid.

Duration and Changes

The 30% ruling applies for a maximum of five years (60 months), though this was reduced from eight years in recent changes. The ruling cannot be extended beyond five years, even if you change employers within the Netherlands (though the ruling can transfer to a new employer if you meet the requirements). Recent changes have also reduced the benefit over time: For the first 20 months, you receive the full 30% tax-free allowance. For months 21-60, the allowance is reduced, though the exact reduction depends on when your ruling was approved. Understanding these changes is crucial for financial planning.

Tax Savings Example

For an expat earning €80,000 gross per year with the 30% ruling: Tax-free amount: 30% of €80,000 = €24,000 (completely tax-free). Taxable income: €80,000 - €24,000 = €56,000. Without the ruling, you'd pay tax on the full €80,000. The savings can amount to €7,000-10,000+ per year in taxes, depending on your tax bracket and other factors. Over five years, this can total €35,000-50,000+ in tax savings, making the 30% ruling one of the most valuable expat tax benefits in Europe.

Limitations and Considerations

Important limitations include: The ruling only applies to employment income, not investment income, rental income, or other sources. You must maintain your employment relationship and cannot become self-employed while using the ruling. If you leave the Netherlands before the five years expire, you cannot transfer unused time to a return trip. The ruling is automatically revoked if you no longer meet the requirements. Recent changes have made the ruling more restrictive, so current applicants should verify the latest requirements.

Using Our Netherlands Calculator with 30% Ruling

Our Netherlands salary calculator includes the 30% ruling option. Simply select "30% Ruling" in advanced options, enter your gross salary, and our calculator will show you the significant tax savings. This helps you understand your true net income and negotiate appropriate compensation when moving to the Netherlands.

Disclaimer: The 30% ruling requirements and benefits have changed significantly in recent years and may continue to evolve. Always consult with a qualified Dutch tax advisor or the Belastingdienst for the most current requirements and to ensure you meet all eligibility criteria before making relocation decisions.