For many expats the 30% ruling may cease by the end of this year as the transition period for those originally with an 8 year duration is discontinued. It is important to check the situation and possibilities to minimise the tax consequences.
Is your 30% ruling ending? Do you have worldwide assets? Contact us now to see what your tax saving possibilities are.
30% ruling end
Prior to 2019, the 30% ruling period was 8 years. As of January 2019 the period was shortened to 5 years. A two-year transition period was implemented lasting until January 1st 2021. This means that:
For anyone granted the ruling between January 1st 2011 and January 1st 2013 the 8-years still count, ending between January 1st 2019 and January 1st 2021;
those granted the ruling between January 1st 2013 and January 1st 2016 will be able to receive the allowance until 31 December 2020, giving them up to an additional two years following the extension;
anyone granted the ruling after January 1st 2016 will be eligible for the 30% ruling benefit for 5 years
30% ruling is ending as of January 2021
This means that for many international workers their 30 % ruling is ending as of January 2021. If you are one of them, it is important to be well prepared for the consequences. Not only will your take-home salary become lower, but you will also need to start thinking about your wealth and what this will mean for your tax return.
Without the 30% ruling, you can no longer opt to be considered a partial non-domestic taxpayer. In other words, you will be treated as a full resident tax payer and you will need to state your worldwide assets in your Dutch tax return. It is important that you are well prepared for this change and seek tax advice.
“Take this example from an international from Greece who’s 30% ruling period will end January 1st 2021. From then on she will no longer be able to opt for non domestic taxpayer; that means she becomes taxable in the Netherlands for her worldwide assets. Since she has savings in Greece she will have to pay box-3 tax in the Netherlands. Our tax consultants can help her structure things in such a way to reduce her tax liability. One of the possibilities we would be looking at is to reduce her box 3 tax liability by using her savings to repay part of her Dutch morgage. Although in that case she would receive less mortgage relief it would als lead to reduction of payable mortgage interest. And she would have less savings and thus as a reduction in box 3 taxation.”
Tax on assets and foreign real estate
This year the threshold per individual is € 30,846 before the asset tax starts. Your assets of between €30,846 and € 103,643 are taxed at 0.54%; assets of between €103,643 and €1,036,418 will be taxed at 1.27%; and anything over that at 1.6%. Given these fixed amounts of tax are unrelated to the actual income your assets generate, the higher your income, the more tax efficient you are. But they are still amounts which have to be found and paid.
You also need to include foreign real estate in your tax return and request a deduction for double taxation. In most Dutch tax treaties, the taxation of real estate is always allocated to the country where the property is located.
Avoid a large fine
It is really important to be honest and fill in your tax form correctly. The Dutch tax office is particularly hot on foreign bank accounts, and you can be fined up to 300% of the unpaid tax if you forget to mention them.’
If you would like to find out more about maximising your tax efficiency and decreasing your risk of fines, please feel free to contact us.
Of course, you don’t want to miss out on any tax benefits in the Netherlands that you are entitled to. In that case, you need to file a tax return and make sure this is done correctly. You can file a tax return for 2022 (from March 2023), 2021, and previous years, till five years back. Take a step in the right direction and contact us to file your tax return. No complicated online forms to be filled in, but personal and proactive service. Our tax consultants are passionate about seeking ways to optimize your tax return in the Netherlands.
How do you know if you need to file a tax return?
Even if you have not received an invitation to submit a tax return in the Netherlands, it is important to have your tax situation checked by a specialized expat tax advisor. You can contact us to check if it would be worthwhile for you to file a tax return. We will ask you the right questions to get the full picture of your tax situation. This way we can check all your tax-saving possibilities and you won’t miss any tax refund opportunities while filing your Dutch tax return. If you have your tax return automatically done by your employer in the Netherlands or a firm hired by them you can also come to us for a second opinion.
When is the deadline?
We will be pleased to look after the preparation of your tax return. The deadline is May 1st, but we will request an extension till May 1st next year for submitting your tax return. since we receive many tax return requests during this period. We will process the tax returns in the order in which they are received as much as possible. Do you have a specific reason why the tax return must be filed quicker? We will take this into account when scheduling the tax return. If you include information about possible deductible expenses and other relevant changes in your situation we can optimize your tax return as much as possible.
Why use a tax advisor?
Our advisors understand that you do not wish to pay more tax than necessary and aim for a maximum tax benefit in your situation. Equally important, we also want to make sure that you are fully compliant. Some tax obligations are easily overlooked since you may not be aware of your responsibilities and the impact of certain actions on your taxes. While paying less tax may seem nice short term, unpaid tax can lead to a high tax bill with fines – up to 300% – and interest in the future. It is therefore important that you inform us as well as possible about your situation, questions, and challenges; you remain responsible for a correct declaration. With our long-term focus, we can advise you proactively as your situation changes. Filing your own tax return or even worse making use of a budget tax return service may seem profitable at first, but there is a good chance that you pay the bill for this later.
Tax return in the Netherlands: which deductions
J.C. Suurmond & zn. Tax consultants are experts in expat tax matters and will make sure the optimum tax status is applied for. We will check whether all tax deductions, credits and allowances, applicable to your situation, are made use of. Regular Dutch tax return deductions are for example:
mortgage interest deduction
educational costs (also of your children or partner),
charitable giving
alimony
non-compensated health costs
In a proactive way you will be advised of your personal tax saving possibilities, which will be processed in the income tax return. As we provide a complete tax return service, we will also check the tax assessments that follow and appeal if needed to make sure your tax affairs are settled correctly.
Which tax form should you file?
The regular tax form is a P-form. In immigration or emigration situations however, an extensive M-form has to be submitted. This is a more extensive Dutch tax return form and has to be submitted on paper. In a situation where you only lived in the Netherlands very short or merely worked in the Netherlands, a C-form for non-domestic taxation may apply. The M-form and C-form often give opportunity for refunds. With help of our direct line to the inspectors at the tax inspectorate for expats in Heerlen, we can check what Dutch tax return needs to be submitted in your situation. We also take care of other tax forms, for example the request for a provisional refund for mortgage relief, which results in a monthly refund instead of a lump sum after the end of the year.
Examples of tax return situations
After completing your last tax assessment yourself it appeared that you would receive a sizeable rebate, but you have recently received a letter stating you owed the tax office €5500. You are quite puzzled and want to have an expert look at it properly.
It is possible that the final assessment turns out different, in this case disadvantageous for you. If you have filed the tax return yourself you may have missed some tax deduction possibilities. You can send us a copy of the tax return that you filed as well as your December pay slip and finally the correspondence that you have now received from the tax office. We will check what happened and what we can do for you.
In 2021 you worked 6 months in a Rotterdam office and need to do the taxes for this time. You did not live in the Netherlands prior to this job.
If you were a single taxpayer the refund entitlement for 2021 may be just over € 4000. We will be glad to start the process to reclaim this amount. We will look after the communication with the tax office until the refund is in your bank account.
When it comes to your tax affairs we understand that you are looking for a trusted tax advisor with a proactive, long term focus and personal service. Our experienced tax advisors can help you understand your tax situation and explore ways to optimize your taxes. We are happy to support you with tax advice if you are in situations like these:
Each international tax situation is unique, amongst others depending on the country you live or generate income from. We are happy to help you optimize your Dutch tax situation by looking at tax saving possibilities in your specific situation or possible scenarios, and understanding how the possible tax treaty works in your situation. We provide tax services like:
Tax advice on the tax impact and benefits of several scenarios;
Minimizing Dutch tax on your income and assets;
Tax filing for several years without missing any tax refund opportunity;
Strategic plan for taxes both in the Netherlands and abroad;
Minimizing tax consequences in (un)expected international working and living situations;
Negotiations with the Dutch Tax office.
What’s it worth?
As qualified advisors we want to be fully aware of your situation to make maximum use of existing Dutch tax regulations and international tax treaties. From our experience we know that a budget cost tax return service may seem profitable at first, but there is a chance that something important is missed. Especially if your situation is more complex. We have claimed back € 50.000 on income tax for a US client with a complex international situation who used an online tax return service for several years and missed out on one important tax refund possibility.
How does it work?
If you have a tax question please send us an email or fill in the contact form with as much details as possible. One of our advisors will get back to you and indicate what is important in your situation, what we can do for you and what the hourly rates are. Our hourly rates range from € 175 to € 235 plus 21% VAT, depending on your situation.
Tax advice example situations
You need some advice to get an understanding of the potential options and tax implications of your situation. You are wondering if we are able to help you with the above scenarios so you get a full understanding of what your options are and what the most cost-effective scenario is. You have accepted a job at an international organization in The Netherlands and will have the corresponding Privileges & Immunities. Your wife works for a UK employer and wants to work from the Dutch office from her employer. The employer though has let her know that they want to retain her on a UK employment contract. Is it possible for her to move to The Netherlands and be resident here but still be employed on a UK employment contract?
If your wife moves to NL and works for the UK employer from NL the results in the obligation for the UK employer to set up a Dutch payroll as this is the only way to make sure the social security contributions (unemployment benefit and disablement insurance) are paid. This option would come with the benefit of the 30% ruling which becomes possible if your wife moves to fulfill a Dutch role. We can register the employer as a withholding agent and look after the employment contract, payroll set up, and monthly payslips and wages tax returns. It does involve some expense but it is then set up correctly which is a benefit both to your wife and to the employer. If the expense is an issue this could be taken off your wifes’ salary. This will be more than made up with the 30% tax-free component.
You and your family live in the Netherlands for 7 years now and own a house in Amstelveen. You are working on a Dutch payroll for your UK employer. You have been asked to relocate to Switzerland. You would like to understand tax implications in case you would relocate to Switzerland and your family stays in the Netherlands. You would be spending weekends in NL.
In the situation, you mention your center of life will remain in NL as this is where your family lives, where you own your home, etc. Consequently, you remain taxable for your worldwide income and assets. There is a treaty with Switzerland that intends to prevent double taxation but it is important to apply this correctly. For example, it is important whether you only work in Switzerland and if it is a Swiss payroll or not.
You and your wife and 3 children are currently living in South Africa. You are working for a local company there. You are originally from the Netherlands and all your family members have the Dutch nationality. You are planning to move back to NL and buy a property in the NL. You are considering two options and want to know the tax consequences of both options are: moving back with the whole family or you staying in South Africa and your wife and children moving to the NL. You have some property and assets abroad. To be able to make the final decision, you need to understand what are the possible Dutch Taxations based on your family situation in case you move back to NL.
Please note that upon immigration to the NL you will become taxable for your worldwide income and wealth here. If you remain physically working in South Africa and tax is paid locally double taxation deduction may be granted. Alternatively, you may consider splitting your tax status.
You and your wife and 3 children are currently living in South Africa. You are working for a local company there. You are originally from The Netherlands. You are planning to move back to NL and buy a property in the NL. You are considering two options and want to know the tax consequences of both options are: moving back with the whole family or you staying in South Africa and your wife and children moving to the NL. You have some property and assets abroad. To be able to make the final decision, you need to understand what the possible Dutch Taxations based on your family situation are in case you move back to NL.
Thank you for your email. We will be glad to help. Please note that upon immigration you will become taxable for your worldwide income and wealth in the Netherlands since your center of life will be in NL. If your family moves to NL and you remain physically working in South Africa and tax is paid locally double taxation deduction may be granted. Alternatively, we may consider splitting your tax status. We would be glad to check out what the possibilities are.
You have been offered a position with a Dutch company in Rotterdam. You currently live and work in the UK and the company does not require you to be present in the office to do your job. You are wondering if you can be a full-time employee of the Dutch company and work from Ireland and whether you need to file an Irish tax return or also a Dutch one in that case.
Many thanks for your email. We will be glad to help. Would the NL employer have a fixed establishment in the UK and be able to put you on an Irish payroll? You will need some advice in the UK on how to make sure income tax and social security are paid in the UK. In NL it would be important that no Dutch tax is withheld etc. Is this something the NL employer is offering?
You are working as an international in the Netherlands for 3 years now and are benefiting from the 30% ruling. Your partner is an Australian citizen and is working and living mainly in Australia. She does have a residence permit though and is registered at the same address as you are in Amsterdam. She spends the majority of her time in Australia which is her main residence. You would like to have some tax advice regarding some of the questions on the tax declaration form, e.g., declaration of assets abroad and tax implications in connection with my partner.
Could I suggest you send me a copy of your last tax return? I assume the 30% ruling is applicable for a further 2 years? Some important questions to get a clearer picture of your tax status are: Does your partner also work in NL? It does not seem she is a fiscal partner? No registered partnership, no children together, not living in a jointly owned property, etc. Does she have to be registered with the town hall? How many days per year is she physically in NL? These issues are important regarding your tax status.
Make sure your M form is filed correctly and tax-efficient. Mistakes are easily made and can unnecessarily cost you a lot of money. Our expert tax advisors are happy to help you save money, time, and worries.
How does it work and what does it cost?
Would you like to know more about the possibilities of having us complete your M form? Send us an email or fill in the contact form and describe your situation and questions. One of our advisers will then indicate by email what we can do for you, what the hourly rates are and how many hours we estimate we need in your situation. For the M form, we usually need 2 to 4 hours in standard situations.
Do you want to get a better picture of what we can do for you? Check the example situations.
Do you need to file the M-form?
Do you want to know if you should apply for the M form in your situation? The M form must be submitted for the year in which you enter or leave the Netherlands. In most cases you will automatically receive an M form from the tax authorities. If you do not automatically receive the M form, it can also be requested. Not sure whether to submit an M form; then let us review your migration situation. An M form can be requested and completed up to 5 years ago.
What can we do for you?
In a migration year there are often extra options for tax benefits. But these are easily missed. The M form has been expanded and a costly mistake is easily made. As experienced tax advisers, we take care of the M form for you, so that you can be sure that it has been filed correctly and tax-efficient. We look at your entire situation so that we do not miss any opportunities for tax benefits, but also do not overlook tax obligations. We do not offer assistance if you want to file the M form yourself.
What about the deadline?
In most cases, the deadline for the declaration is July 1. If you let us take care of your M-tax return, we usually request an extension. After completing the form, it will take a few months before you receive a provisional assessment. It can then take up to three years before you receive the final assessment. If you would like to outsource the completion of the M declaration to us or submit your situation to us first, please contact us.
Examples of M form situations in the Netherlands
You started working in August 2020 in Rotterdam. You did not receive a notification to file a tax return but wanted to file it anyway. At first, you wanted to file an M form but you did not understand dutch and were not sure. Since on the Belastingdienst website you saw that you could submit your tax return as well and that all my data was already filed, you submitted it this way. It was accepted and returned to you. However, your colleagues told you again that for the first year working in NL you need to submit the M form anyways. And that probably next year the Tax office will ask back what was returned to you now.
We assume that the assessment you received was provisional and that it could yet change. It could be that your refund was too high or not high enough. Please send us a copy of your submitted tax return as well as your immigration date, annual salary statement and December pay slip. We will then have a look and advise what should be done.
You are a Greek national that lived in the Netherlands from 2014 until 2020 working full time in a company with a fixed salary. You moved back to Greece on January 1st, 2020. In that year you did not receive any income in the Netherlands, but you did keep your apartment until July 2019 and then deregistered from the council in Amsterdam. You originally filed a regular tax return for 2020, but received an M-form from the tax authorities, notifying me that an M-form is the only tax return form they will accept in my case. What can our office do for you in this case?
It may be advantageous to correct the emigration date to the beginning of the year 2020. Would you please send us a copy of your 2019 tax return as well as a copy of the 2020 tax return that you submitted incorrectly? In this case, it is already important whether the property was already for sale since January 1st, 2020.
You are an Italian ex-pat living in the Netherlands. You moved to the Netherlands in 2018 for your studies and started working in the Netherlands in 2019. You have declared your tax returns from 2018 (till 2020) yourself but never filed an M-form. In your 2020 tax return, you deducted your study costs. Initially, you received tax back, but later the Tax office asked you to pay the received amount back to them. Their reason is that you never filed an M-form and never declared these study costs before. You want to know how to proceed.
In your situation indeed an M-form needs to be submitted for 2018,, appeal against the 2019 final assessment is needed, appeal against the 2020 final assessment, and consequently submitting the 2021 tax return. If you would like to proceed we will send you a list with information that we need.
You emigrated or immigrated together with your partner. You are tax partners. Is it sufficient if you process your partner’s data and income in the M declaration, or does your partner have to fill in an M form?
In the event of migration, it is necessary that both taxpayers submit an M form.
In the year in which you emigrated, you partly worked in the Netherlands as an employee and partly from your own company. You are wondering how to file your M form.
With your emigration, the sole proprietorship has also moved and should be deregistered. A sole proprietorship is not a separate entity. Annual accounts should be prepared for the Dutch period in the migration year and then the company should be deregistered. In a number of cases, a Dutch EMS can continue to exist.
You moved back to your home country last year for work. Your family remained in The Netherlands to finish school. You visited your family regularly. You have deregistered from The Netherlands and received an M form from the tax authorities with the request to complete it. Is this correct?
Since your family still lived in the Netherlands, your life center was still in the Netherlands. In that case, you remain taxable in the Netherlands. An exemption can then be requested for the days worked in England, as well as for the national insurance contributions. consequently, your deregistration and the M-form may not be correct.
You moved to live and work in The Netherlands in 2020. However, you did not register in the Netherlands until 2021. You subsequently received an M-ticket for 2021.
In your situation, a bill of exchange may need to be applied because you have in fact already emigrated in a previous year. In practice, however, exchanging a banknote at the tax authorities is often difficult.
Are you leaving the Netherlands (again)? Do you want to know how to optimize your moving situation tax-wise? If you seek tax advice in an early stage you can make maximum use of tax refund opportunities.
Change in tax status
Do you still have income from or assets in the Netherlands after your move? In that case you will still have to pay income tax in the Netherlands but as a non-resident taxpayer. We can advise you on how to structure things in a tax-efficient way. Do not forget to deregister with the city council when you are leaving the Netherlands. If you forget to deregister, the tax authorities will continue to view you as a domestic taxpayer, and tax you as such.
Sell of keep your house after leaving the Netherlands?
If you own houses in more than one country it can be quite complicated to oversee what is the best step to take. We can advise you whether it is more profitable tax-wise to sell or keep the house when you leave the Netherlands. And in case you keep it, whether renting it out or keeping it for your own use is best.
M form
For the year in which you have left the Netherlands, you will have to file an M form. This form gives you several extra refund opportunities. It is important to have your entire situation carefully considered since costly mistakes are easily made. Our tax advisors can help you with filing the M form correctly and make sure you do not miss any tax refunds.
Example situations of leaving the Netherlands
You are planning to move to Qatar for work next February. You are still wondering if your wife and two children should move at the same time as you or finish the school year in the Netherlands and move this summer. This will also depend on the tax implications; you want to avoid paying tax in the Netherlands.
In the ideal situation, you deregister together at the same time prior to receiving income from the UAE. In that case, your tax liability in the Netherlands will stop in Februari (Except housing tax in case you still own a house in NL). If your wife and children stay in the Netherlands for a while you are still taxable in NL since your family lives in NL and thus your center of life is in NL. This leads to tax liability in NL. If you choose this scenario we can advise you on double taxation relief possibilities.
You and your wife are from the UK and have been living in NL for the last 12 years. You will stop working at the end of next month and want to understand the taxation impact of leaving the Netherlands this year or staying in the NL for another year. You have considerable savings and investments.
We will be glad to help and sort out the tax implications of both options. It depends on whether you will also receive a pension from the UK, where you will be spending the most time, and if you also have property here and/ or in the UK.
Buying a house in The Netherlands may be more favourable than renting as there are major advantages in owning a house.
Most important is that interest paid on a mortgage on your primary residence is fully tax-deductible, as well as mortgage-related expenses. It goes without saying that this can lead to very substantial tax deductions. The maximum tax deduction rate will be gradually limited but is still an advantageous facility. Also, the interest rate for mortgages is at its lowest in the Netherlands now, which makes your monthly expenses lower than in case you would rent a house. The tax relief can be paid in monthly installments during the year, after filing the tax form for a provisional refund for mortgage relief, to be requested by the tax authorities. We will be happy to help you fill in the form.
Mortgage interest deduction
If you move out of the country again you can rent the house out, sell it, or keep it for your own use. If you keep it for your own use in some circumstances the property can remain in box 1 with mortgage interest deduction. In case you sell the property, please note: there is no capital gains tax. As international tax advisors, we can advise you about your specific housing situation, as we know it can be quite complicated when you for example in case you own houses in more than one country.
If, as a resident, your worldwide income is taxable in the Netherlands it may also be (partly) subject to taxation elsewhere, resulting in double taxation. In most of these cases double taxation relief is available through a tax credit which exempts you from paying tax in the Netherlands on this same income.
In some situations however, income could be taxable in two countries or not taxable at all. If your salary is earned in different countries a salary split often offers possibilities to reduce tax. To define in which country a salary is taxable the 183 days rule is applied in most countries. Contact us to see if this applies to you too.
US citizens
Special regulations apply to US citizens, who remain taxable in the USA, making available further tax planning opportunities. International organisations often have special policies on taxation. This could for example result in exemption of taxation on wages and pensions.
As the rules and forms of double taxation regulations can be different from one country to the next, your particular situation will have to be looked into carefully and the best tax planning structure will have to be worked out. Please write to us and present us with your particular (double taxation) situation and we will search out the most advantageous solution.
Example situations of double taxation relief
You are a South African citizen and intend to emigrate to the Netherlands. From 2022 you will also receive a company pension in the UK, which is partly earned by working abroad and tax-free. However, you are paying income tax on the other part of my pension from the company. You are planning to move to the Netherlands, where you already have a property and will be a tax resident. You want to know what your tax obligations in NL are, given that you already pay the tax in the UK.
Have you submitted tax returns in NL since you have your NL property? If you move to NL you will become taxable for your worldwide income and wealth. If the UK is entitled to tax you then NL will grant a double taxation deduction. This is something we will need to look into. Generally, tax is levied based on the treaties in the country of residence. To give you an idea of the tax consequences we would need an overview of your total annual income as well as your worldwide wealth.
You have recently moved to NL as an ex-pat. You are employed in NL and at the same time employed by the same employer’s headquarter in South Africa. You will be receiving a Dutch salary and also a salary from SA. Since you will be staying in NL for over 183 days you are wondering if your SA salary is taxable in NL. You would like to understand better the tax implication of your SA income.
Your question is relevant; the point is really: where is your center of life? Do you live in NL or do you live in SA? Where are you registered? If your center of life is in NL you need to declare your worldwide income. The 183-day rule is only applicable if you don’t live in NL. Where do you work for your SA income? If you don’t physically work in SA it is questionable why not all income comes via the NL pay roll.
Do you need tax advise on how to minimize wealth tax in your international living or job situation? Are you (considering) moving to the Netherlands and want to understand wealth tax implications. Or is your 30% ruling ending and do you have worldwide assets? Check the example situations or submit your own situation to us directly. One of our advisors will give you a detailed response and let you know how we can minimize your Box 3 tax obligations.
What is Box 3 tax actually?
The Dutch capital gains or wealth tax is in fact nothing more than the tax on fictitious income from savings and investments; the so-called Box 3 tax, although ‘under construction’. The reference date for taxed box 3 assets is January 1. A recent development is that due to a High Court decision on box 3, the tax authorities have confirmed that no box 3 tax assessments will be raised for the time being. We would not advise taking any action with regards to saving on box 3 taxation until there is more clarity as to how the Box 3 tax will work out. The High Court concluded that the fictitious return on investment often leads to a relatively heavy financial burden, especially if taxpayers’ assets are mostly savings.
End of 30% ruling
When your 30% ruling ends you become regularly taxable in the Netherlands for your worldwide wealth (Box 3 tax) and you will have to declare these in your tax return. Make sure you do this properly to avoid high fines. In case you are still under the 30% ruling but have not opted for partial non-domestic taxation you will also have to declare your (worldwide) assets in box 3. Dutch real estate (not the owner-occupied first dwelling) is always taxable, also during the 30% ruling period. We do recommend double-checking if you have correctly opted for partial non-domestic taxation since a mistake can be easily made. In case you forgot to opt for partial non-domestic taxation we can check what tax obligations you have.
Not the entire box 3 capital is taxed. In 2022, the first €50,650 (double for tax partners) will be exempt. This is called the tax-free allowance. In 2021 this was still €50,000 (€100,000 for partners). Anyone who saves green and/or invests green is eligible for additional tax-free capital of €61,215 (2022).
Box 3 tax rates
In 2021, the rate on the notional return in box 3 has been increased to 31%. This rate will not be adjusted in 2022.
Below is a schematic representation of the box 3 tax in 2021 and 2022 with 4 categories of wealth bases.
Fictitious return
From 2017, a statutory regulation was introduced, changing the fictitious or fixed return. Already since 2017, the actual return that people achieve on their net wealth (excluding the equity capital on their own home) is not relevant. Box 3 has three rate brackets. However, the Tax and Customs Administration assumes that wealthy people also invest a lot. This means that, depending on the size of the wealth, it is assumed that part of the wealth is saved and part is invested (the so-called ‘asset mix’). The return that is expected to be achieved for both capital elements has been laid down by law (the fixed amount). This does not take into account the actual choice of taxpayers or the actual return. According to the tax authorities, investments yield much more, so in the fictitious world of the tax authorities, wealthy people in The Netherlands normally invest 33 to 100 percent of their wealth in shares, investment funds, or real estate. There is as yet no prospect of taxation on the wealth in box 3 over the actual income.
Saving tax in box 3
The reference date for taxed box 3 assets is January 1, so you need to make sure the amount is as low as possible on that date. Here are a few tips to reduce your assets in a smart way before 1 January next year. It is recommended to have an expert tax consultant check which of these or other options apply to your situation:
If you have substantial assets, it could be an option to set up an OFGR or BV to save box 3 tax;
Make a gift to a relative or non-relative that will be used for the purchase, repayment, or renovation of a home that is or will be a primary residence. Till 2024 an amount of approx. € 106.671.is free of gift tax;
Use your savings to pay off part of the mortgage on the primary residence (box 1). In addition to wealth tax, this often also saves you some mortgage interest;
Deposit money into an annuity.
Example situations of declaring assets abroad
You are from the UK and your wife is Dutch. Together you have been living abroad in several countries for the last 8 years and are living in the US now. You own three houses in the UK and your wife owns a house in the Netherlands. You also own some stock options which were already taxed in both the UK and US. You are both working for a US employer. You are considering moving to the Netherlands or to the UK, but are not sure what would be best tax-wise since you have some assets abroad.
If you move you the Netherlands you will become tax liable for your worldwide income (box 1) and assets (box 3). There is no capital gains tax on, for example, shares. Since you have never lived in Since you have never lived in the Netherlands, the 30% ruling is a good option to avoid all box 3 levies for a maximum period of 5 years and to enjoy a 30% tax-free salary. For this, you need a Dutch job offer as a reason for immigration. This can be an offer from a Dutch employer, but also from an existing American employer that, for example, sets up a payroll administration in the Netherlands and can then be seen as a Dutch employer. We are happy to be of service. It is essential that you do not become a resident in the Netherlands before you have arranged a Dutch job offer. The 30% ruling does not apply to your girlfriend as she has Dutch nationality and has not been away from the Netherlands long enough. She may, however, benefit from the exemption in box 3, provided you are tax partners. With the 30% ruling, the Netherlands will undoubtedly prove to be the most favorable tax climate. It might be wise to also check this in the UK.
You are working for an international organization as an ex-pat in the Netherlands. You are not liable for income tax in the NL, but have been filing your taxes anyway for the “wealth tax”. Your American partner is still working for a US company and would like to move to the NL permanently but keep his job. You have a Dutch living together arrangement. You are looking for a reliable tax consulting company who would be able to help us in this situation and, most importantly, avoid him being heavily taxed by both countries once he moves over here.
Since you are working for an international organization it is important you can check if there is an exemption part for declaring your wealth in box 3. If your partner immigrates he will become taxable for his worldwide income and wealth. Double taxation deduction should be looked for in the US as the treaty appoints the right to tax to the country of residence. It would be most advantageous if your partner got an employment offer from an NL employer – which could be the US employer setting up as an NL employer – and consequently immigrate. In addition, this would give scope for the 30% ruling.
Inheritance tax especially, but also gift tax, can be a very complicated matter, depending on many variables. Dutch inheritance and gift tax percentages are pretty high, but there are also tax exemptions. The sooner you seek advice, the better our specialized tax advisors can work out a way for you to be able to keep as much money from the inheritance or gift as possible. We can also check if there are possibilities to avoid double taxation.
Inheritance tax return
Do you live abroad and are the testator in the Netherlands? In that case, Dutch inheritance tax must be paid. Did the testator live abroad and you in the Netherlands? Then no inheritance tax has to be paid in the Netherlands. You do have to file a declaration of the acquired assets at a later stage, box 3 tax. We are happy to be of service with advice, the declaration of inheritance tax, and/or declaration of box-3 assets.
The rate that must be paid in the inheritance tax return depends on the relationship with the deceased and the amount inherited and varies between 10 and 40%. In the case of inheritance tax, an exempt amount applies on which you do not have to file an inheritance tax return. In addition to the inheritance tax an adjusted income tax return must be submitted for the deceased in the year of death with an F-form. These are often difficult matters for the heirs, especially since they do not often occur. We can also file this F-form for you in the most tax saving manner.
Gift tax return
A gift from abroad may not fall under the Dutch tax regime. If the gift is from a non-resident or a resident (but not a Dutch citizen) that has emigrated from the Netherlands more than a year ago, no gift tax is due. But you may become liable for “Box 3” tax as soon as the money arrives in the Netherlands. Donations are often made to contribute to the purchase of a home for the children. Now, a resident of the Netherlands (who is not a Dutch citizen) continues to be a resident, liable only for gift tax (not inheritance tax), up to 1 year after emigrating from the Netherlands.
In case gift tax is due, the person who receives the donation must together with the donor file a gift tax return, but the gift tax itself can also be taken on by the donor and be included in the donation, which then leads to a higher gift tax. With a view to the gift tax return, it is advisable to obtain tax advice on donations. We are happy to advise you on the right time to make donations and on the level of rates and exemptions. We also specialize in estate planning, where we strive to transfer your assets to the next generation in the best possible way for tax purposes.
The gift tax rates are the same as the inheritance tax, but the gift tax exemption amounts are different.
Example situations inheritance and gift tax
You want to transfer your American inheritance & social security benefits to the Netherlands. You are wondering what tax consequences there will be and how to structure things tax-wise.
Since how long have you been living in NL? Could you enlarge a bit as to the assets within the inheritance, and when you received these? As for social security, is it possible for the US to move this as a lump sum? It would also be useful if you could provide your last NL tax return so we have a complete picture of your situation.
You are living in the NL for over 10 years and are originally from the UK. Your father plans to leave you his apartment in London. You are looking for some advice regarding this and how to limit the tax exposure. You think you are not liable for tax here in the Netherlands, only in the UK as your father lives there. Another option is that he already puts it on your name. You are wondering if in that case, you would be tax liable here in NL or if you should just add the value to your box 3.
It is correct that there is no gift or inheritance tax in this case. When you become the owner of the property you will need to declare this in box 3. Based on the treaty double taxation deduction should limit box 3 taxation. We would be happy to advise you on this matter.
You are planning to buy a house in Amsterdam and your mother is willing to gift me 100k for that purpose. She is living in France. You would like to seek your advice on how to keep tax to a minimum.
If your mother does not have Dutch nationality and she has not lived in NL in the past year, there is no Dutch gift tax due. You will need to document the gift as the bank may ask questions upon receipt of the money. Also, the notary may request information regarding the source of the money.
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. Would you like to know where your income will be taxed in order to prevent and/or anticipate any tax problems? Please contact us to discuss your situation.
When is the 183 rule relevant?
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.
Salary in the country of residence remains taxable
Incidentally, days worked in the state of residence or even a third country, are in any case taxable in the state of residence. This is often overlooked. If you live in a particular country, there is a resident tax liability there. Worldwide income and assets must then be stated in the tax return in that country. Subsequently, on the basis of the 183-day rule, a conclusion is arrived at for which part double taxation deduction can be requested.
In the context of the 183-day scheme, it is very important to keep a good record of where you spend each day during the year. A calendar specifying this is an important thing an inspector will request in employment with more than one working country.
Examples of 183 day rule situations
With the 183-day rule, small nuances in situations can already lead to different outcomes whether or not the scheme is applicable. As a rule, you cannot simply apply the following example situations to your situation.
You are considering an employment offer from a Dutch company. Although you will be earning a salary from the Netherlands, you will still continue residing in Portugal and mostly working from there. Your new job would also involve frequent travelling to other countries worldwide. Consequently you expect not to be visiting the Netherlands for work (meetings etc.) for more than 183 days per year. You are wondering if you will need to pay taxes in the Netherlands anyway.
If you are on a Dutch pay roll and due to your domicile you are only taxable for days physically worked in NL. Any other days are taxable in Portugal. You will also need exemption in NL for social security contributions and health insurance as it seems to me these will continue in Portugal. It is possible to correct this afterwards via a tax return. But possibly your future NL employer has an idee how to address this issue. Being on a Dutch pay roll is not strictly necessary however. The NL company can probably run a Portuguese pay roll either through their NL company (if possible under Portuguese rule) or via an own to be established entity in Portugal or a third party pay roll. We would be happy to give you some further advice.
Last year you’ve worked for 9 months in the Netherlands, for a Spanish company. You paid taxes in Spain, but at the end of the year, in December, the Spanish company returned the taxes to you and told you that you had to pay taxes in Netherlands because you had exceeded the 183 day period. You are a Bulgarian national, with permanent residence in Bulgaria, and are working abroad as an electrical supervisor on different projects for your Spanish employer.
In principle, it is correct that tax is due in NL as well as social security contributions if you lived and worked here and if you did not live here but worked more than 183 days. Also important are the following questions: was there no fixed establishment of the employer in NL? Did you have Dutch health insurance? Did you register as living in NL? Have you received any correspondence from the tax office? We will be glad to help.
You are an expat in the Netherlands since 2018 and now started working in Germany for your Dutch employer in January 2021. You are working in Germany for 14 days and 7 days in the Netherlands on a monthly basis. You are paying wages tax and social security and health insurance contributions in the Netherlands and you also receive mortgage interest deduction and childcare allowance here. However, you will be working over 183 days per year in Germany and are concerned about the tax consequences this has for your situation.
If you are physically present in Germany for more than 183 days during a 12-month period, Germany is entitled to levy on the salary earned there. In that case, the Netherlands must grant double taxation deduction. This may affect the mortgage relief refund that you receive. The social security contributions however remain due in the Netherlands because you also work more than 25% of your time in the Netherlands. It is consequently needed to submit both a Dutch and German tax return to make sure taxes are paid correctly. It may also be necessary to apply for an A1 statement to confirm social security contributions are due in The Netherlands.
You lived and worked in NL as an ex-pat. Beginning of this year you started working in Tanzania for a Tanzanian employer. The work schedule is 2 months in Tanzania and 1 month in the NL (plus holidays). You did not deregister from the Netherlands as your house and partner remain in NL. You would like to avoid being taxed on your salary in NL after being taxed already in Tanzania. And therefore if you need to watch out for the 183 days stay in NL to ensure your total stay remains less than that.
If you only work in Tanzania tax consequences should be minimal. If you however work remotely from NL for your Tanzanian employer there will indeed be tax consequences. We will be glad to look into further detail. Is your Dutch health insurance no longer active since your work in Tanzania?
Wij gebruiken technologieën zoals cookies om informatie over uw apparaat op te slaan en/of te raadplegen. We doen dit met als doel om de beste ervaring te bieden en om gepersonaliseerde advertenties te tonen. Door in te stemmen met deze technologieën kunnen wij gegevens zoals surfgedrag of unieke ID's op deze site verwerken. Als u geen toestemming geeft of uw toestemming intrekt, kan dit een nadelige invloed hebben op bepaalde functies en mogelijkheden.
Functioneel
Always active
De technische opslag of toegang is strikt noodzakelijk voor het legitieme doel het gebruik mogelijk te maken van een specifieke dienst waarom de abonnee of gebruiker uitdrukkelijk heeft gevraagd, of met als enig doel de uitvoering van de transmissie van een communicatie over een elektronisch communicatienetwerk.
Voorkeuren
De technische opslag of toegang is noodzakelijk voor het legitieme doel voorkeuren op te slaan die niet door de abonnee of gebruiker zijn aangevraagd.
Statistieken
De technische opslag of toegang die uitsluitend voor statistische doeleinden wordt gebruikt.De technische opslag of toegang die uitsluitend wordt gebruikt voor anonieme statistische doeleinden. Zonder dagvaarding, vrijwillige naleving door je Internet Service Provider, of aanvullende gegevens van een derde partij, kan informatie die alleen voor dit doel wordt opgeslagen of opgehaald gewoonlijk niet worden gebruikt om je te identificeren.
Marketing
De technische opslag of toegang is nodig om gebruikersprofielen op te stellen voor het verzenden van reclame, of om de gebruiker op een site of over verschillende sites te volgen voor soortgelijke marketingdoeleinden.
