Generous tax incentives for highly skilled migrants in the Netherlands — do you qualify? The 30% ruling is a Dutch tax facility aimed at attracting highly skilled migrants with specific skills or expertise, subject to certain conditions. It benefits both the employees and employers. Check how it works and the conditions.
First of all, the 30% ruling makes it more interesting and easier to attract talent. Imagine you want great staff and you need to attract the best talent and expertise! Global competition for hiring a highly skilled migrant is really tough. With the 30% ruling you can offer them partly tax-free allowances. This way you are way more attractive for an expat to choose your company.
In general, employers choose to apply the 30% ruling because it is efficient and straightforward. You can choose another way, because you can also reimburse the actual costs yourself, but that requires a considerable administration of receipts and reporting, which is very expensive. The simplest approach is to apply the 30% ruling.
When you hire highly skilled migrants from abroad or when they are stationed in the Netherlands by their employer, the following conditions apply:
Expats must have specific expertise that is not immediately available within the Dutch labor market. To determine whether the international employee has specific expertise, the Tax and Customs Administration looks at three factors:
– the employee’s level of education;
– relevant work experience (two and a half years in a comparable position is considered sufficient);
– does the salary meet the 30% standard and does it indicate specific professional knowledge?
Expats who have lived at least 150 kilometers from the Dutch border for two thirds of a period of 24 months before starting a job in the Netherlands;
Expats who are paid through a Dutch payroll administration and whose salary is subject to Dutch withholding tax.
Employees can take the 30% ruling with them when they leave their employment. The 30% ruling can generally be applied for a maximum period of 5 years (60 months).
The 30% ruling is valid for five years. This period may be shorter if the expat has previously worked in the Netherlands or has previously spent time in the Netherlands.
The expat must continue to meet the salary standard. If the taxable wage is lower than this standard, the 30% ruling can no longer be applied. You will not get the 30% ruling back if the wage is suddenly increased anyway. Read our page 30% -ruling for employees carefully!
The 30% ruling is transferable, provided the period between jobs does not exceed three months. If the expat changes employer (joins a new company), a report must be sent to the tax authorities. Payingit International arranges this for all its clients.
Submit the application for the 30% ruling for the expat within four months of starting the employment. If the application is submitted after the four months after the start of the employment in the Netherlands, the full benefit is not available. The 30% ruling is granted as of the month after the month in which the request for the 30% ruling is submitted. Both you as the employer and the international employee must have the official tax ruling letter in your possession.
Good news! Payingit International handles the application process on behalf of our clients. It is a process that takes time and the application must be submitted within a certain amount of time. Payingit International arranges everything for you and ensures that the application is sent on time.
Payingit International charges a fee for the registration process, which we will discuss with you in advance. We respond within 24 hours and help you find the perfect solution and approach for all expats employed by you.
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