Employees who started to benefit from 30% rulings prior to 2012, may in certain cases lose their 30% facility this or next year. Employees who did not have the ruling for more than five years prior to January 1, 2012 need to also qualify under the post-2012 requirements as from the 6th year of their local employment. Sometimes they cannot meet these ‘new’ requirements. In these cases the 30% will not have the maximum duration of 8 years but considerably less.
First: what is the 30% facility? The 30% (formerly 35%) facility is a tax advantage for certain expat employees in the Netherlands with a maximum duration of 8 years.
• The full salary is reduced to a 70% taxable salary (i.e. 30% is exempt from payroll tax and personal income tax);
• Optional deemed non-resident status in the Netherlands (no Box 2 or Box 3 in our income tax, generally only your salary is taxed);
• Additional tax-free reimbursement for international schools;
• All other Dutch income tax deductions still remain applicable;
• Entrepreneurial expats can also use this ruling if employed by their corporation.
‘New’ requirements for the 30% ruling: To be entitled to the 30% ruling, all of the following post-2012 conditions have to be met:
• You have agreed in writing with your employer that the 30% ruling is applicable;
• You have been transferred from abroad to a Dutch employer or you have been recruited from abroad by a Dutch employer;
• You did not reside within 150 kilometres of the Dutch border for the last 18 out of 24 months at the time of hiring;
• Your taxable salary in 2016 is at least € 36,889 per year (excluding the 30% ruling) or € 28,041 for persons under 30 years with a university masters;
• You have specific expertise that is scarce in the Netherlands.
For example, a person who obtained the 30% ruling in 2011 will in 2016 need to qualify under the above mentioned post-2012-rules in order to continue to benefit from the 30% facility. If he/she was recruited from Brussels in 2011, he/she will lose the facility in 2016 due to the ‘new’ 150 kilometre rule.