183 day rule
Do you work abroad for part of the year while living in the Netherlands? The 183-day rule prevents you from paying tax on your salary in two countries and determines in which country your salary should be taxed. Perhaps you are partially living in The Netherlands and working and living abroad. You would like to know where your income will be taxed, in order to prevent and/or anticipate issues with double taxation.
183 day rule
Most tax treaties with other countries stipulate that the country of employment may levy on the salary. However, part of these tax treaties is the 183-day rule. If applicable, the country of residence may levy tax. This applies if 3 conditions are met:
- the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in any twelve month period commencing or ending in the fiscal year concerned; and
- the remuneration/ compensation is paid by, or on behalf of, an employer who is not a resident of the other State; and
- the remuneration/ compensation is not borne by a permanent establishment which the employer has in the other State.
If this is the case, the salary is not taxable in the state of employment until more than 183 days have been spent there. If not, the entire salary is taxed in the country of residence.
Often the article in the tax treaty that includes the 183-day rule is misunderstood or misapplied. Read more about the 183-day rule on the Belastingdienst website.
When is it recommendable to hire an international tax advisor?
- If you have been working in the Netherlands for 9 months for a foreign employer;
- If you will be working abroad e.g. 14 days per 3 weeks but living and staying 1 week in the Netherlands;
- If you will work less than 183 days in The Netherlands for you new Dutch employer;
- If your job involves frequent travelling to other countries worldwide and you want to prevent double taxation.
In the situations mentioned aboved it is wise to let an international tax advisor have a look at your situation. We can advise you on the possibilities according to the Dutch and treaty tax rules and look after your tax returns. For advice regarding the national tax system of another country, a local advisor will have to be employed, who knows all the ins and outs of this. We are in possession of a vast, international network of advisors.
How can we help you?
Suurmond Tax-Consultants has been advising expats and individuals for more than 35 years. After contacting us it will become clear whether we are the right party to help you.
In a contact form or an e-mail you can explain your situation and ask us any questions you may have. Your situation will be looked at by one of our advisors. On the basis of this, the tax advisor will come back to you for further details. Our hourly rate ranges from €175 to €285 excl. 21% VAT.
If you agree, then the advisor will look at the different aspects which apply to your situation and which elements are important to work on. Then a proposal is made with all the elements included on which you need advice and guidance.
After this, we will update you on the amount of hours which we expect will be required. It is not always easy to make an accurate estimate as we are dependent on information and details from your side as well. In addition, how your case will proceed depends on the response of the tax inspector as well to our argument. If required, a consultation can be set up online or at our office.
The importance of hiring an international tax advisor
If you are (partially) living and/or working in the Netherlands, you will want to know for certain that what you are doing is done correctly, as you must be compliant. The Tax Office can impose high penalties if your affairs aren’t in order and correctly presented.
At our office you can be certain that you will be supported by experienced advisors and who will provide you with relevant tax advice. Depending on your situation double taxation deduction will be requested.
You will know in which country you are to submit a tax return and where for example your social security contributions and health insurance are due. In the most diverse circumstances we are committed to providing complete tax advice.
View the 3 conditions on the Tax Office website, which ensure the 183-day rule applies in your situation.
Who are Suurmond Tax Consultants
Since 1986 expat and business tax advice in relation to the Netherlands is one of our expertises we provide to our individual and/ or business clients.
In addition, we can also assist in a variety of other cross-border situations. We will ensure you are compliant as well as pay no more tax than needed. Examples include advising clients as to starting a business in The Netherlands, accounting, property tax, and amnesty ruling. We file all types of tax returns and specialise for example in the 30% ruling and 183-days rule consequences. The value we can add with our fiscal advice, is a key focus point to us. Also, what should not be overlooked, is the fact that a correct tax return will prevent future issues and penalties. This is essential when moving to a new country, or when setting up a business in a new country.