The 30% ruling for your foreign employees in the Netherlands

Published by:
Netherlands Chamber of Commerce, KVK
Netherlands Chamber of Commerce, KVK

If you are an employer in the Netherlands, and you hire highly skilled workers to come and work for you in the Netherlands, you can offer them the 30% ruling. This ruling gives them a tax advantage. It compensates for the costs they have for moving to the Netherlands. This article explains how it works.

What is the 30% ruling and how does it work?

Highly skilled employees who move to the Netherlands to work for you may run into so-called extraterritorial costs. These are costs related to moving to the Netherlands but also the costs of living here, which can be higher than in the home country. Under the 30% ruling, you can compensate your highly skilled foreign employees for these costs over a maximum period of 5 years. There are 2 ways to do this:

  • You can pay a percentage of their salary tax-free.
  • Your employee can claim the extraterritorial costs they have made as work expenses, and you can reimburse them fully.

Read more about what falls under extraterritorial costs (in Dutch).

Choose to reimburse the costs or pay a tax-free percentage

As the employer of employees from abroad, you can choose between reimbursing the actual extraterritorial costs tax-free, or applying for the tax-free payment over a percentage of your employee’s wages. You choose every year, for 5 years, when you file your tax return in the first payroll period of the year.

Changes to the 30% ruling

If you hired a foreign employee before 1 January 2024, you could choose to pay them 30% of their salary tax-free for 5 years, or reimburse them.

The Dutch government wants to limit the 30% ruling. These are the changes in 2024 and 2025:

Employees who apply in 2024 for the 30% facility, will not receive this full advantage for 5 years. Instead, it will be reduced in 3 steps:

  • For the first 20 months, you may pay 30% of the salary tax-free.
  • The next 20 months after that, you may pay 20% of the salary tax-free.
  • The next 20 months after that, you may pay 10% of the salary tax-free

From 1 January 2024, you may only apply the 30% ruling over a maximum amount. This is the so-called maximum remuneration (Balkenende-norm in Dutch) set in the Standard for Remuneration Act (Wet Normering Topinkomens). The amount is set every year.

From 1 January 2025, employees who use the 30% ruling can no longer apply the so-called partial foreign tax liability (partiële buitenlandse belastingplicht) in their income tax return. Currently, they are seen as a foreign taxpayer, even though they live and work in the Netherlands, for their taxable income from substantial interest (box 2) and from savings and investments (box 3). This means they do not have to pay taxes in Box 2 and Box 3 on foreign capital income.

From 1 January 2025, they will have to file their taxable income from substantial interest and savings and investments in the Netherlands.

Criteria for using the 30% ruling

Before you apply for the 30% ruling to the Netherlands Tax Administration, make sure you meet the criteria.


If you reimburse the costs, these costs must be reasonable and plausible. You enter the costs and reimbursement for each employee in your payroll records.

30% Ruling

To qualify for the 30% ruling, the following criteria must be met:

  1. The worker is employed (in loondienst) by your company.
  2. The worker must be a highly skilled migrant. This means they must have a specific expertise that is scarce or unique in the Dutch labour market.
  3. They must be recruited from abroad or transferred within a multinational company to work in the Netherlands. The employee must have lived more than 150 kilometres away from the Dutch borders for at least 16 months of the 24 months before moving to the Netherlands.
  4. The employee must comply with the income standard (toetsloon). Your employee must earn a certain minimum wage showing their expertise. Their wage will also depend on age and education. For a table with wages, click the question ‘when do I have a specific expertise’.
    • If your employee earns a lower wage, they can only receive a reimbursement on the difference between their salary and the income standard.
    • Employees who conduct scientific research in a designated research facility or doctors training to be a specialist do not need to meet this income criterion.
  5. You have applied to the Netherlands Tax Administration (Belastingdienst), and have received a decision (beschikking) which states that you may use the 30% facility.

Apply for a decision to the Tax Administration

To apply for the 30% ruling on behalf of an employee, you need a decision (beschikking) from the Netherlands Tax Administration. You must file this request for a decision within 4 months after the first workday of your employee. You will receive the outcome within 10 weeks. Find the application form on the website of the Tax Administration.

The application should include supporting documents such as employment contracts, and proof of qualifications. The application form indicates which documentation must be included.

The expiry date of the 30% facility is stated in the decision.

Change of employer

You cannot take over the 30% ruling from another, former employer. This means that if you hire an employee whose former employer made use of the 30% ruling, you cannot automatically use the 30% ruling too. You and the employee must submit a new request together.

If your company is taken over by another company, your employees with the 30% arrangement will keep this arrangement when transferring to the new company.

Stay informed

Since 2012, there have been several changes to the original 30% ruling: from 10 to 8 years, and from 8 to 5. There may be other changes to the 30% ruling within the 5-year period of your employee. Consult with a tax adviser or specialist to stay up-to-date.

Questions relating to this article?

Please contact the Netherlands Chamber of Commerce, KVK