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Dutch Tax FAQs and Low Hanging Fruits

By

Richard Bierlaagh

Posted

May 20, 2022

at

06:29 AM

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Are you considering a relocation to the Netherlands, or perhaps you've recently moved already. Either way, you'll need to be aware of how the tax system works. This article answers some questions on common matters you'll need to tick off the list.

30% Ruling

Persons with a 30% ruling, can receive 30% of their wage exempt from tax for up to 5 years. Also: you are exempt from wealth and dividend tax from non-Dutch source.

Buying a House

The ‘Habitual Abode’-regime allows the deduction of costs related to any purchased main dwelling. This includes interest payments on the mortgage, but also the fees incurred for obtaining said loan or those for the Notary’s documentation.

Arriving halfway through the year

Wealth tax is calculated on an annual basis, and is paid pro-rata if you aren’t a tax resident during the full year.

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FAQs

Can I incorporate a Dutch company? Tax law does not inhibit this!

Do I pay gift tax on gifts from abroad? No, the giver pays' this tax, not the receiver.

Are my foreign savings taxed? Yes (if you aren’t under a 30% ruling). Dutch tax law taxes your worldwide income, and under tax treaties, the resident state ‘gets to tax’ its resident’s savings. So: it does not matter when the bank is situated that maintains your account. You may need to fill in the aacount balance manually.

Is my foreign real estate taxed? Generally speaking: no. Although Dutch domestic tax law does include your worldwide assets, treaties often allocate the right to tax to the source state; the state in which the real estate is located. Therefore, said real estate should not be included in your taxable base.

Can I deduct my childrens’ tuition? Dutch taw law allows for the deduction of ‘schooling costs’, which are costs incurred for classes and courses that foreseeably lead to increased earning capacities (i.e.: flute lessons generally no, accounting classes generally yes). Your childrens’ tuition, however, is not deductible.

Learn More About Living, Working and Paying Taxes in the Netherlands

Archipel is a Dutch tax firm in The Hague, they are Tax Tech on the front end, a quality boutique at the back. Archipel Tax Advisors translate between real life and taxation to provide tailor made solutions and a personal approach.

Connect with Richard for tax and financial advice as an expatriate/immigrant in the Netherlands.

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