Changes to the 30% tax ruling from 2024

Oh boy, the web’s gone bananas about this 30% rule change. Our inbox is exploding, and every corner of the internet’s buzzing with questions about this new law shaking things up from January 1st, 2024. So what happened?

On October 26, 2023, the House of Representatives approved additional tax cuts. The new rules kick in on January 1st, so employers and expats, watch out! The Senate will discuss on December 11th and 12th, and vote on December 19th. But make sure you’re informed ahead of time!

If you’d prefer to watch instead of reading, you can head over to our Q&A video on this topic

What does the new amendment mean? 

Back in 2019, the House of Reps decided to cut the duration of the 30% tax ruling from 8 to 5 years. Now, they’re trimming it down even more starting 2024. It’s not just businesses feeling the squeeze; expats’ personal lives are also getting knotted up in all this.

To make a long, complicated story short: as an expat you will no longer be able to enjoy a 5-year, 30% tax-free salary from the 1st of January 2024 UNLESS you had already been allocated the 30% ruling or within the ‘transitional law’. From January 1st next year, as an expat, you can get;

  • Up to 30% of your pay tax-free for the first 20 months, 
  • then 20% for the next 20 months, 
  • and 10% for the 20 months after that; 
  • After 60 months, the tax perk stops. 

One thing is clear – there is still a lot of uncertainty about the specific changes to the law and more specifically their feasibility. It’s obvious that changes are happening, but it’s better to be cautious. The Senate is still unsure if they can handle recalculations for employees who got only a snippet of the 30% benefit, due to the fact that they either changed jobs or were in the Netherlands before. They’re also not sure about cases where costs go over the 30% deal and are applicable for the ‘alternative extraterritorial costs’ declaration instead (ET costs).

I have received a positive decision. Will the amendment affect me?

A special deal is there for workers who got the 30% bonus by December 2023. They won’t face the cut. 

This helps workers who already have the 30% benefit and also those who start working in the Netherlands before December 31st. But again, be cautious, since we’re not sure how they’ll make this special law work and what it’ll be like. 

You can imagine, some lawyers and accountants are excited to figure it out, and curious to see how this will be implemented. Yours truly included. 
We’ll be following the official updates and making sure to translate them to understandable and practical language for you!

%d bloggers like this: