EY Street address: Mail address: Boompjes 258 P.O. Box 2295 3011 XZ Rotterdam 3000 CG Rotterdam Netherlands Netherlands
Executive contacts
Bea Haring
+31 (88) 407-8867 (resident in Rotterdam) Email: bea.haring@nl.ey.com
Jelle Romeijn +31 (88) 407-3765 (resident in The Hague) Email: jelle.romeijn@nl.ey.com
Saskia van der Zande +31 (88) 407-1648 (resident in Amsterdam) Email: saskia.van.der.zande@nl.ey.com
Robert Rouwers +31 (88) 407-8342 (resident in Rotterdam) Email: robert.rouwers@nl.ey.com
Jan-Bertram Rietveld +31 (88) 407-8322 (resident in Rotterdam) Email: jan-bertram.rietveld@nl.ey.com
Joost Smits +31 (88) 407-4558 (resident in Eindhoven) Email: joost.c.smits@nl.ey.com
Immigration contacts
Natasha Doerga-Misier +31 (88) 407-8307 (resident in Rotterdam) Email: natasha.doerga.misier@nl.ey.com
Anne Kwint-Bijleveld +31 (88) 407-1254 (resident in Rotterdam) Email: anne.bijleveld@nl.ey.com
Claudia Duifhuizen +31 (88) 407-2511 (resident in Rotterdam) Email: claudia.duifhuizen@nl.ey.com
International social security contacts
Karima Taouil +31 (88) 407-9045 (resident in Rotterdam) Email: karima.taouil@nl.ey.com
Marleen IJgosse-Brummelhuis +31 (88) 407-3777 (resident in The Hague) Email: marleen.brummelhuis@nl.ey.com Evelien de Jong +31 (88) 407-4529 (resident in Eindhoven) Email: evelien.de.jong@nl.ey.com
Private Client Services contact
Willem-Jan Vermeer +31 (88) 407-8458 (resident in Rotterdam) Email: willem.jan.vermeer@nl.ey.com
A. Income tax
Who is liable. Residents are subject to income tax in the Netherlands on their worldwide income. Nonresidents are subject to tax on specific Netherlands-source income only.
Residence is determined based on all facts and circumstances. For Dutch residency, it is essential to determine whether the indi vidual has a lasting tie of a personal nature with the Netherlands. For this purpose, specific circumstances (social, economic or legal) are not decisive; all personal ties are relevant. Simply being formally registered in the Municipal Personal Records Database or a similar foreign database is not sufficient. Double tax resi dence is possible under certain conditions.
Subject to certain conditions, nonresident taxpayers living in the European Union (EU), Switzerland or one of the member states of the European Economic Area (EEA), which are Iceland, Liechtenstein and Norway, can be taxed as a resident taxpayer of the Netherlands. Furthermore, the 30% facility (see 30% facility) provides the option for residents of the Netherlands to be taxed as a “partial” nonresident taxpayer.
Income subject to tax. Netherlands income tax is levied on three categories (boxes) of income. Each box has its own rules to cal culate taxable income, its own tax rates and exemptions. In gen eral, negative income from one box may not be offset against positive income from another box.
Box 1 income. Box 1 income includes employment income, busi ness profits and income from a primary residence. Profits received from personal business operations, from independent personal services and from certain shares of partnership income are taxed as business profits.
Tax on income in Box 1 is levied at progressive tax rates, with a maximum tax rate of 49.5% on income over EUR68,507 (see Rates). Wage tax is levied throughout the year (pay-as-you-earn) on employment income and directors’ fees if a Dutch wage tax withholding agent is available. The wage tax paid serves as an advance payment of the final income tax payable. Penalty taxes for employers can apply for excessive severance payments (rate of 75%) and certain early retirement payments (rate of 52%).
Employment income. Employment income includes salaries, wages, pensions, stock options, bonuses and allowances (for ex ample, home leave and cost-of-living). Housing allowances may be taxable in certain situations. Some allowances for expenses may be paid as a tax-free allowance, subject to certain limitations and restrictions. The system of tax-free employment benefits and allowances is embodied in the work-related costs scheme (in Dutch: werkkostenregeling; see Deductions and allowances). This scheme has a major impact on employment conditions pol icy as a whole. Expatriates may qualify for a special tax regime, the 30% facility. This facility exempts 30% of certain employ ment income from taxation (see 30% facility).
Income and gains derived by private equity managers and other individuals from investments in which they are deemed to have a so-called “lucrative interest” is subject to the progressive income tax rates up to a maximum of 49.5% in a manner similar to entre preneur income (the 30% facility is not applicable).
A nonresident individual receiving income from employment actually carried on in the Netherlands is subject to Dutch income tax. In certain situations involving multinational companies, the so-called 60-days rule applies. Under this rule, the Netherlands gives up its right to levy tax on employment income if the employee works in the Netherlands less than 60 days in any 12-month period. A nonresident who is employed by a Dutch public entity is also subject to Dutch income tax, even if the employment is carried on outside the Netherlands. A nonresident who is employed by a Dutch employer and is working in the Netherlands for part of the time may be liable to tax in the Netherlands on the full remuneration received from the employer.
However, in this situation, tax treaties generally do not allow the Netherlands to tax income related to non-Dutch workdays.
Self-employment income. Annual profit derived from a business must be calculated in a consistent manner and in accordance with sound business practices. Annual profit is reduced by related business expenses, and taxable income is then determined by subtracting the deductions and the personal allowances described in Deductions and allowances
A nonresident individual earning income from an enterprise car ried on through either a permanent establishment or a permanent representative in the Netherlands is subject to Dutch income tax. Profits of a permanent establishment are calculated on the same basis as profits of resident taxpayers.
For the allocation of profit between a foreign head office and a Dutch permanent establishment, the permanent establishment is deemed, in principle, to be a separate entity dealing at arm’s length.
Announced but not yet enacted rules, which will likely take effect in 2022, are designed to improve the position of freelancers, other self-employed persons and their clients in the areas of employment law, tax law and social security law, but also to com bat “bogus” self-employment. Until then, if the contract with a (assumed) self-employed persons turns out to be a (deemed) labor contract, the clients risk supplementary assessments for wage tax, social security contribution and fines if they deliber ately allow a situation of evident “bogus” self-employment to be created or to continue to exist.
Directors’ fees. Directors’ fees are treated as ordinary employment income.
An employee who is a 5% or greater shareholder is deemed to earn a salary of at least EUR47,000 a year. A lower amount may be taken into account for a shareholder who can prove that his or her actual salary at arm’s length is less than EUR47,000. However, if the tax authorities can prove that a salary at arm’s length would be higher than EUR47,000, the director’s salary must equal at least 75% of the salary at arm’s length (with a minimum of EUR47,000) and at least as much as 100% of the highest salary of other non-shareholder employees. These rules do not apply if the salary at arm’s length of the employee/shareholder does not exceed the amount of EUR5,000 a year.
A nonresident receiving income as a director of a company resi dent in the Netherlands is subject to Dutch income tax. Tax trea ties entered into by the Netherlands generally grant the right to tax this income in the resident country of the company that pays the directors’ fees. Exemptions are made, among others, in the tax treaties with Switzerland and the United Kingdom.
For resident taxpayers (subject to income tax on their worldwide income) receiving income as a director of a company that is not resident in the Netherlands, double taxation is eliminated by either the tax exemption method (with progression clause) or the credit method. The applicable method depends on the applicable tax treaty. It has been announced that the Netherlands will with draw an approval to use the (more advantageous) tax exemption
method instead of the credit method, most likely as of the 2022 tax year. As a result, in most cases the credit method will apply to directors’ fees.
Approval of foreign pension schemes. Expatriates in the Netherlands often want to continue their foreign pension scheme during the period they work in the Netherlands. The main rule is that the employee contributions to the foreign pension scheme are not tax deductible in the Netherlands and the employer con tributions are taxable. However, a “corresponding approval” can be requested from the Dutch tax authorities. When the approval is granted, the employee contributions to the pension scheme are tax deductible and the employer contributions will not be taxable, in general, in the same way as in the country of origin. To receive a corresponding approval, several conditions need to be fulfilled. The approval procedure makes a distinction between EU and non-EU pension schemes. The corresponding approval can be received for the period of employment in the Netherlands but in principle no longer than five years (a longer period can be agreed upon in tax treaties).
Precautionary tax assessment. The Dutch tax authorities impose a precautionary tax assessment on pension entitlements when an individual emigrates and ceases to be tax resident in the Netherlands. The payment of this tax is suspended for a period of 10 years. If certain forbidden transactions take place (for example, receiving the pension in a lump-sum payment) during the 10-year period, the precautionary tax assessment is collected. Otherwise, the tax assessment lapses at the end of this period. The Dutch precautionary tax assessment has the potential to conflict with some tax treaties. In these situations, an appeal could be filed. The Netherlands is increasingly pursuing changes in its tax treaties regarding the taxation of pension income. In a deviation from the Organisation for Economic Cooperation and Development (OECD) Model Tax Convention, the state of source rather than the resident state may tax pension income. Readers should always check the applicable tax treaty and corresponding protocols and consult a tax professional.
Income from a primary residence. The owner of a primary resi dence is taxed on the deemed rental value of the residence which is determined based on the so-called “real estate valuation act,” which aims to reflect fair market value. For dwellings with a value exceeding EUR75,000, in general, a rate of 0.5% applies to calculate the deemed rental value. For dwellings with a value exceeding EUR1,110,000, a rate of 2.35% applies on the excess. Besides this taxable income from the primary residency, tax deductions related to the primary residency are available. For a period of up to 30 years, mortgage interest paid for the acquisi tion, maintenance or improvement of a primary residence is deductible for tax purposes from Box 1 income. Restrictions are imposed on the deduction of mortgage interest. One of the restrictions is that the mortgage should include at least an annu ity scheme for paying off the mortgage; that is, there is a prohibi tion on interest-only mortgages. Annual installments must be made within a maximum of 30 years. Transitional rules apply to mortgages in existence before 2013. In general, the acquisition of a primary residence cannot be fully financed by a mortgage if a
capital gain on the previous primary residence was realized within three years before the purchase of the new residence. In principle, income from a second residence is taxed as Box 3 income.
The rate in the top bracket (49.5%), against which mortgage interest is deductible, is lowered yearly as shown in the following table:
Tax rate for negative income from a primary residence Year Rate (%) 2020 46.00 2021 43.00 2022 40.00 2023 37.05
Box 2 income. Box 2 income includes profits from a substantial shareholding, which is a shareholding of at least 5% of a certain class of shares of a company resident in or outside the Netherlands. Both capital gains and regular income (dividends) are taxed. Tax is levied at a fixed rate of 26.9%.
Nonresidents are taxable on capital gains and regular income from a substantial interest in a company resident in the Netherlands.
Box 3 income. Box 3 income consists of income from savings and investments, including shares and bank accounts (excluding the value of loans with respect to a primary residence) and income from savings accounts maintained outside the Netherlands. Nonresident taxpayers are only taxable on the net value of real estate located in the Netherlands or on profit rights in an enter prise resident in the Netherlands.
The value at the beginning of the calendar year of a taxpayer’s savings and investments is deemed to generate a fixed income. This implies that actual income generated from savings and investments is not taxed (for example, the actual rent received from renting out a property). In case of emigration or immigration during the course of the year, the value at the beginning of the year is recalculated on a pro rata basis. The deemed 2021 income in Box 3 is taxed at a fixed rate of 31%. The following table illustrates the taxation of Box 3 income.
Savings and Deemed income Tax Effective investments percentage rate tax rate
EUR % % %
Up to 50,000
More than 950,000
1.40
0.59 50,000 to 950,000
1.76
Specific exemptions apply for certain assets, such as personal goods, art and certain life insurance policies. A general exemp tion of EUR50,000 applies per resident taxpayer. Any dividend withholding tax serves as an advance payment of the final income tax payable.
A dividend withholding tax is imposed on dividends paid by resident companies to resident or nonresident recipients. The withholding tax rate is 15%, unless reduced or eliminated by an
applicable tax treaty. Resident individuals may credit domestic withholding tax against their total income tax due. A credit may be granted against Dutch income tax for foreign taxes paid on dividends and interest.
A 15% withholding tax is levied on dividends derived by non residents, unless the rate is reduced by an applicable double tax treaty. Nonresident taxpayers cannot credit the Dutch dividend withholding tax against the final income tax payable. No further tax is imposed unless the shares constitute a substantial interest, in which case, income tax may be levied and dividend withhold ing tax may be credited.
Interest and royalties derived by a nonresident natural person are not subject to withholding tax. However, interest is included in taxable income if the recipient holds a substantial interest in the payer. As of 2021, other rules apply for legal entities.
Taxation of employer-provided stock options. In general, the profit from stock options is taxed at the moment of exercise. The taxable gain arising at exercise is the fair market value of the shares on the exercise date less the exercise price. If the employ ee worked in more than one state in the period between the grant of the stock option and the vesting of it (became unconditional), the taxable gain is allocated on a pro rata basis.
A benefit gained from a share option scheme awarded by an innovative startup is 25% tax-exempt up to an amount of EUR50,000. Consequently, a maximum of EUR12,500 is exclud ed from the levying of tax. Certain conditions apply. The govern ment is expected to present new legislation around March 2022.
Cross-border severance packages. The main rule in the guidelines of the OECD Model Tax Convention regarding the taxation of a cross-border severance package is that the severance payment is taxable in the country where the employee worked in the 12 months before the termination of his or her employment contract. If an individual has worked in several countries, the allocation is made on a pro rata basis. The Netherlands explicitly conforms to the OECD guidelines.
Capital gains. Capital gains generally are exempt from tax. How ever, exceptions apply at the applicable 2021 tax rates indicated in the following table.
Taxable gains Rate
Capital gains realized on the disposal of business assets (including real estate) and on the disposal of other assets that qualify as income from independently performed activities
Normal rates apply* Capital gains on liquidation of a company Normal rates apply* Capital gains derived from the sale of a substantial interest in a company (that is, 5% of the issued share capital); 2021 rate
For normal rates, see Rates
Nonresidents are subject to income tax at normal rates on capital gains derived from the disposal of business assets and on capital gains derived from transfers of shares in a domestic corporation if the shares constitute a substantial interest.
Deductions and allowances
Dutch wage tax regulation. Allowances for business expenses are tax-free or taxable, according to the rules of the so-called “work related costs scheme” (werkkostenregeling in Dutch). The prin ciple of this scheme is that fewer rules apply with respect to taxfree allowances and employment benefits, and that all allowances and benefits granted to employees by employers essentially constitute taxable wages. Specific exemptions are provided, such as for certain business expenses and education. The employer is entitled to a tax-free work-related costs budget per year of 1.18% of the total taxable wage bill. If the actual work-related costs exceed this budget, an employer’s final levy of 80% on the excess is due. For 2021, the tax-free work-related costs budget of 1.18% is increased to 1.7% of the first EUR400,000 of the total taxable wage bill. Because of the COVID-19 pandemic crisis, the per centage of 1.7% of the first EUR400,000 is increased to 3%, also applicable in 2021.
Deductible expenses and tax-free allowances. Under certain measures, taxpayers may claim the following deductions and taxfree allowances:
• Deduction for mortgage interest for the acquisition, maintenance or improvement of the taxpayer’s primary residence (see Income from a primary residence).
• Deduction for certain life insurance premiums that entitle indi viduals to annuity payments. The amount depends on the avail able pension rights of the individual.
• Deduction for alimony payments to the ex-partner.
• Deduction for extraordinary expenses exceeding a certain threshold, including medical expenses, support provided to direct relatives, education expenses within a certain range and qualifying gifts.
• A moving allowance, up to a maximum of EUR7,750, may be granted besides reimbursing for the actual cost to transport the goods. If the employer does not reimburse the employee for the moving costs, these amounts are not deductible by the employee.
• An allowance for business travel, including commuting expens es, may be granted for private transportation, subject to certain limitations. Commuting expenses for public transportation may be reimbursed tax-free in full. Business travel and commuting expenses may not be deducted.
The rate in the top bracket (2021: 49.5%), against which expenses are deductible, is lowered as of 1 January 2021 to the follow ing rates.
Tax rate against which expenses are deductible Year Rate (%)
2021 43.0 2022 40.0
37.05
The deductions listed above for certain life insurance premiums, alimony payments, extraordinary expenses and gifts are in
principle not available to nonresidents. An exception may be applicable for certain residents of the EU, Switzerland or one of the member states of the EEA.
Under certain circumstances, a tax-free allowance for extraterri torial costs may also be available (see 30% facility) for qualifying expatriates.
30% facility. Expatriates in the Netherlands may qualify for a special tax facility, the 30% facility. This facility enables an em ployer to pay an employee a tax-free allowance of up to a maximum of 30% of present employment income (no upper limit) and a tax-free reimbursement of school fees for children attending international schools. A 30% statement issued by the tax au thorities is required.
On request, the employee may be considered a nonresident tax payer of the Netherlands for certain items of income (partial nonresident status). A nonresident taxpayer is exempt from the tax on income from savings and investments, unless this income relates to the net value of real estate located in the Netherlands or on profit rights in an enterprise resident in the Netherlands (see Box 3 income).
The maximum term for the 30% facility is limited to 60 months as of 1 January 2019 (up to and until 2018: 96 months). Transitional rules apply for existing situations on 31 December 2018. The possibility of paying a tax-free allowance for the extraterritorial costs actually incurred will also lapse after five years. The period of 60 months is reduced if the employee has worked or stayed in the Netherlands for a period of time in the past.
Periods of tax liability in the Netherlands as a result of employ ment without physically being present are also deducted. An ex ample is a director of a Dutch company who lives abroad.
To qualify for the 30% facility, certain conditions must be met, including the following:
• The employee must be recruited or assigned from abroad to work in the Netherlands.
• Dutch wage tax must be withheld.
• In the employment contract (or in an addendum to the contract), the employer and employee must agree that a tax-free allow ance for extraterritorial costs up to a maximum of 30% is included in the compensation package.
• The employee must have highly skilled specific expertise that is “scarce or not available” in the Dutch labor market.
• Before employment in the Netherlands, the foreign employee must have resided for more than 16 months of the 24 months prior to his or her Dutch employment in an area more than 150 kilometers from the Dutch border. This distance is measured “as a crow flies.” If not, the employee is excluded from the 30% facility. The tax authorities demand strong and extended proof that before the start of his or her employment in the Netherlands, the recruited employee was living outside the range of 150 kilometers.
The requirement that the employee from abroad has specific expertise is solely met with a standard taxable salary (for 2021) of more than EUR38,961 (excluding the 30% allowance). Foreign income may also be included in this salary level. An exception is
made for certain groups of employees, such as graduates under the age of 30 holding a master’s degree, in which case the taxable salary must exceed EUR29,616. No salary standard applies to certain groups of academics and medical trainees at designated academic institutions. The salary standards will be indexed annually.
If an employee meets the income standard, he or she is deemed to hold specific expertise. In addition, the employee must continue to meet the condition that the specific expertise is either scarce or not available in the Netherlands. The following factors are taken into account in this scarcity criterion:
• The level of education attained by the employee
• The employee’s experience relevant to the position
• The remuneration standard of the position in question in the Netherlands relative to the remuneration level in the employee’s own country
Bonuses and other emoluments paid after the end of the month following the month in which the Dutch employment ends is excluded from the 30% facility.
The tax-free allowance is intended to cover all “extraterritorial costs.” As a result, no additional tax-exempt reimbursements of extraterritorial costs are allowed on top of the 30% tax-free allowance.
Instead of applying the 30% facility, reimbursement of the actual extraterritorial costs free of tax is allowed for a maximum of five years even if this amount is higher than 30% of the present employment income. Consequently, the employer must maintain records of all actual extraterritorial costs reimbursed free of tax.
Rates. The rates applicable to income from Box 1, effective from 1 January 2021 are set forth in the following table.
National
Taxable income Insurance
Not Rate contributions Total rate Exceeding exceeding of tax A B A B EUR EUR % % % % % 0 35,129 9.45 9.75 27.65 19.20 37.10 35,130 68,507 37.10 0.00 0.00 37.10 37.10 68,508 49.50 0.00 0.00 49.50 49.50
A These rates apply to persons who are entitled to a pension on the basis of the General Old Age Pensions Act (AOW). In 2019, 2020 and 2021, this entitle ment starts at the age of 66 years and four months. This age will rise in small steps as of 2022 until it reaches 67 years in 2024.
B These rates apply to persons not included in the category “A” above.
Income from Box 2 is subject to tax at a rate of 26.9% in 2021. Income from Box 3 is subject to tax at a rate of 31%.
Personal tax credits. Personal tax credits are fixed amounts that directly decrease the income tax payable.
The personal tax credits consist of an income-related general credit, an income-related employment credit for recipients of income from profits and employment and other credits, such as for children, single parents and senior citizens. In general, the personal tax credits may not exceed tax payable plus National
Insurance contributions, and, consequently, application of the credits cannot result in a refund.
The amount of the general credit and the employment credit dif fer depending on the age and/or income of the individual. The maximum general credit is EUR2,837 and reduced step by step from an income of EUR21,043, resulting in a general credit of EUR0 for income exceeding EUR68,508. The maximum employ ment credit is EUR4,205 and reduced step by step from an income of EUR35,653, resulting in an employment credit of EUR0 for employment income exceeding EUR105,737.
Approximately 25% of the credits relates to income tax or wage tax. The other 75% relates to National Insurance contributions due (see Section C). The share of the personal tax credits that relates to tax is, in principle, reserved for resident taxpayers and for foreign taxpayers who are resident in Bonaire, St. Eustatius and Saba (BES-Islands), the EU, the EEA or Switzerland, pro vided that 90% or more of their income is subject to payroll or income tax in the Netherlands. If this income criterion is not met, treatment as a resident taxpayer is only possible for this group if the Netherlands is required to do so under European law or a relevant tax treaty. Taxpayers living in other countries are not entitled to the tax part of the personal tax credits. Employees liv ing abroad who have social security coverage in the Netherlands retain their right to the social security share of the personal tax credits.
Relief for losses. Resident and nonresident individual taxpayers may carry losses related to Box 1 back for three years or forward for nine years. In general, positive income of one box may not be offset by negative income of another box.
B. Other taxes
Net worth tax. The Netherlands does not impose net worth tax.
Inheritance and gift taxes. Inheritance tax and gift tax are levied on all property inherited from or donated by an individual who was a resident or deemed to be a resident of the Netherlands at the time of death or donation. Dutch individuals who emigrate from the Netherlands are deemed to be resident in the Netherlands for 10 years after emigration. A gift made by a former Dutch resident, regardless of nationality, who left the Netherlands less than one year before making the gift is subject to Dutch gift tax. Tax is levied on an heir or a gift recipient, regardless of his or her place of residence.
Inheritance and gift tax rates range from 10%, 20% and 30% to a maximum of 40% of the value of a taxable estate or donation after deductions, depending on the applicable exemptions and the relationship of the recipient to the deceased or donor.
Inheritance tax exemptions. The most important exemptions from inheritance tax are the following:
• Acquisition by the surviving spouse: a maximum exemption of EUR671,910
• Acquisition by the (grand) children: a maximum exemption of EUR21,282
• Acquisition by disabled children: a maximum exemption of EUR63,836
• Acquisition by parents: a maximum exemption of EUR50,397
• Generally, property acquired by an acknowledged charity
• In other cases: EUR2,244
Gift tax exemptions. The most important exemptions from gift tax are the following:
• Gifts from a parent to a child: a general one-off exemption of EUR6,604
• A general one-off gift from the parents to a child aged 18 to 40: EUR26,881, which may be increased in the case of a gift issued for or applied to the payment of the child’s education expenses (EUR55,996) or to the acquisition of a primary residence (EUR105,302)
• Other gifts: up to 3,244
Filing obligation and payment. The recipient of an inheritance or gift must file a tax return within eight months from the time of death. For gift tax, the return needs to be filed within two months after the calendar year in which the gift was made. The Revenue imposes a tax assessment stating the tax due after the tax return has been filed.
Nonresidents inheriting assets from an individual who was a resident or a deemed resident of the Netherlands at the time of death are subject to inheritance taxes. To provide relief from double taxation, the Netherlands has entered into inheritance tax treaties.
Inheritance tax treaties. The Netherlands has entered into inheri tance tax treaties with Aruba, Austria, Curaçao, Finland, Israel, Sint Maarten, Sweden, Switzerland, the United Kingdom, and the United States. All treaties cover inheritance tax with respect to bequests. Only the treaties with Aruba, Austria, Curaçao, Sint Maarten and the United Kingdom also cover gift tax. If no tax treaty applies, Dutch unilateral law for the avoidance of double taxation applies, but, in practice, it does not always prevent dou ble taxation completely.
C. Social security
Contributions. The Social Security Acts can be classified into three categories, which are the following:
• National Insurance Acts
• Employee Insurance Acts
• Health Insurance Act
National Insurance Acts provide benefits to all Dutch residents and to persons who work in the Netherlands and are subject to the levy of wage tax. National Insurance contributions are payable on taxable income of up to EUR35,129 and are not deductible for tax purposes. The maximum annual National Insurance contribu tion payable by an employee is EUR9,713 (before taking into account the social security credit). Employee Insurance Acts provide additional benefits for wage earners. Employee Insurance contributions are EUR0 for the employee and fully paid by the employer with a maximum of EUR9,100 per employee. In addi tion, the employer must pay an income-related contribution for the health insurance of the employee with a maximum of
EUR4,082 per employee. The total maximum employer costs amount to EUR13,182 per employee per year. The employee must pay an insurance premium for his or her health care of approximately EUR1,705.
The following table presents the contribution rates for 2021 for employees under the National Insurance Acts.
Maximum income for National Insurance Maximum Percentage premiums contribution % EUR EUR
General old age pension (AOW) 17.90 35,129 6,228 Survivor benefits (ANW) 0.10 35,129 35 Special health care (WLZ) 9.65 35,129 3,309 Minus credits (general and employment credit) —* Total contribution due from the employee only 27.65 9,713
* The social security part of the amounts of these credits differ depending on the age and/or income of the individual. The maximum amount of the general credit is approximately 75% of EUR2,837 and is reduced step by step from an income of EUR21,044 to EUR0. The maximum amount of the employment credit is approximately 75% of EUR3,837 and is reduced step by step from an income of EUR35,653, resulting in an employment credit of EUR0 for employ ment income exceeding EUR105,737.
The following tables present the contribution rates for 2021 for employers under the Employee Insurance Acts.
Maximum income liable for Maximum Percentage contribution contribution Disability % EUR EUR Basic employer’s contribution (disability; WAO/WIA) 7.03 58,311 4,099
Employer’s childcare contribution 0.50 58,311 292 Differentiated return to Work Fund (consists of two components) 1.36 58,311 793 Total due from the employer only 8.89 5,184
Maximum income liable for Maximum Percentage contribution contribution Unemployment (WW) % EUR EUR
Employer’s contribution, low* 2.7 58,311 1,574
Employer’s contribution, high* 7.7 58,311 4,490
* As of 1 January 2020, the employer’s contribution for unemployment depends on the nature of the employment contract with a lower contribution for written, signed and dated contracts entered into for an indefinite period, and a higher contribution for all other contracts, such as on-call contracts and minimum/ maximum hour contracts. The difference between the contributions has been set at a fixed 5%. As of 1 August 2021, the unemployment contributions are low ered in order to reduce the employer’s costs. As of 1 August 2021, the low contribution is 0.34% and the high contribution is 5.34%, so the difference remains 5%. The maximum income liable for contributions does not change during the calendar year and remains EUR58,311.
An employer must pay 70% of an employee’s salary for a twoyear period if the employee cannot perform his or her duties because of illness. For this purpose, the maximum salary consid ered is EUR58,311 per year. To cover its obligations under the act, an employer may obtain private insurance or establish a reserve.
Health Insurance. Every individual who is socially insured in the Netherlands must take out an individual Health Insurance policy. Every individual aged 18 and older pays a standard contribution averaging EUR1,705 per year for Health Insurance. Insurance claims up to EUR385 per year are for the individual’s own risk. Any insurance claims in excess of EUR385 are paid by the health insurer, unless the individual has chosen a higher personal risk (in return for lower contributions). In addition to the standard contribution, an income-related contribution is payable at a rate of 7.0% (for self-employed persons, a 5.75% rate applies), capped at an income of EUR58,311. The 7.0% income-related contribution for employees is fully paid by their employers. This employers’ contribution is not considered taxable income to the employee. Resident individuals who are not socially insured in the Netherlands must register with a care insurer in the Netherlands to retain their right to medical care in the Netherlands. The following table presents the contribution rates for Health Insurance.
Maximum income liable for Maximum Percentage contribution contribution
EUR EUR
Employer’s contribution
standard
various health insurance
standard
following table
maximum 2021 social security
Employer’s Employee’s Maximum contribution contribution contribution EUR EUR EUR
insurance
general
employment
Employer’s Employee’s Maximum contribution contribution contribution EUR EUR EUR
Employee insurance schemes
Disability 5,184
Unemployment, low (b) 1,001
0 5,184
0 1,001
Unemployment, high (b) 3,917 0 3,917
Total Unemployment, low 10,267 11,418 21,685
Unemployment, high 13,183 11,418 24,601
(a) The social security part of the amounts of these credits differs depending on the age and/or income of the individual. The maximum amount of the general credit is approximately 75% of EUR2,837 and is reduced step by step from an income of EUR21,044 to EUR0. The maximum amount of the employment credit is approximately 75% of EUR4,205 and is reduced step by step from an income of EUR35,653, resulting in an employment credit of EUR0 for employment income exceeding EUR105,737.
(b) These are the combined contributions for the periods of 1 January 2021 to 31 July 2021 and 1 August 2021 to 31 December 2021.
Additional contributions for health care and coverage of risk of paying salary during the first two years of sickness are not cov ered in the above overview.
Totalization agreements. Nonresidents earning income from Dutch employment are, in principle, subject to Dutch National Insurance, Employee Insurance and Health Insurance contribu tions. As a result, they may be subject to social security taxes both in their home country and in the Netherlands.
To provide relief from double social security contributions and to assure that an employee is socially insured, the Netherlands has entered into agreements with several countries. As an EU mem ber state, the Netherlands applies EU Regulation 883/04, which entered into force on 1 May 2010 and replaced EU Regulation 1408/71. The Regulation applies to all EU member states and Iceland, Lichtenstein, Norway and Switzerland.
Because the United Kingdom has left the EU (Brexit) as of 31 January 2020, the United Kingdom and the EU entered into a Trade and Cooperation Agreement.
Individuals whose cross-border activities commenced prior to 1 January 2021 and are eligible for the grandfathering provisions of the Withdrawal Agreement will continue to be subject to the previous social security arrangements in place prior to 1 January 2021.
The position of individuals whose cross-border activities commenced on or after 1 January 2021 will fall under the Trade and Cooperation Agreement.
The Netherlands has also entered into social security agreements with the following non-EU jurisdictions.
Australia Chile Korea (South) Bosnia and China Mainland Kosovo Herzegovina Egypt Montenegro
Canada India Morocco (including Isle of Man New Zealand Quebec) Israel (except for North Macedonia
Cape Verde East Jerusalem, Serbia Channel Islands the Gaza Strip, Tunisia (Alderney, Guernsey, Golan and the Turkey Herm, Jersey West Bank) Uruguay and Jethou) Japan United States
D. Tax filing and payment procedures
The tax year in the Netherlands is the calendar year. Income tax returns relating to a calendar year must be filed before 1 May of the following year, unless an extension is obtained. If the income tax return is filed before 1 April of the following year, the Dutch tax authorities respond before 1 July of that year.
Employers withhold tax and National Insurance premiums (com bined) on wages from employees under the Pay-As-You-Earn (PAYE) system. For many people, the wage tax is not only an advance payment of income tax and National Insurance premi ums, but it is also the final payment. Any additional income tax and National Insurance premiums due must normally be paid within two months after receipt of an assessment rather than when filing the tax return.
Married persons are taxed separately on employment and busi ness income. Two “partners” (see definition of “partner” below) may elect for the following categories of income and deductions to be attributed to a particular partner:
• Income from home ownership. If this income is negative because of the deduction of mortgage interest, it is advisable to attribute this income to the partner with the highest income.
• Profits from a substantial shareholding.
• Personal deductions.
Nonresidents may not make this election unless they are taxed as Dutch tax residents. Foreign taxpayers who are resident in Bonaire, St. Eustatius and Saba (BES-Islands), the EU, the EEA or Switzerland are taxed as Dutch tax residents, provided that 90% or more of their income is subject to payroll or income tax in the Netherlands. For this purpose, an income declaration from the resident state needs to be obtained to measure the 90% criterion. If this income criterion is not met, treatment as a resident taxpayer is only possible for this group if the Netherlands is required to do so under European law or a relevant tax treaty. If the 90% income criterion is not met, nonresident taxpayers may claim under certain conditions a pro rata deduction of taxdeductible expenses.
The Income Tax Law includes the term “partner.” A “partner” is understood to mean the spouse or registered partner of a taxpay er, provided he or she is not permanently separated. Unmarried adults who live together and are registered at the same address with the municipal authorities are treated as partners for tax purposes if one of the following circumstances exists:
• A child was born from their relationship.
• A child of one of the individuals was officially acknowledged by the other individual.
• The individuals are stated as partners in a pension plan.
• The individuals own a primary residence together.
• The individuals have reached the age of majority and an under age child of one of them is registered at the same address.
• The individuals were considered to be partners in the previous calendar year.
Partner status for tax purposes provides the following advantag es:
• Eligibility for several business-related facilities (working part ners’ deduction and transfer of a business or a part thereof without tax consequences).
• The option of allocating to both partners at their discretion the yield assessment base for capital yield tax (Box 3), except for the year of immigration or emigration, and the joint elements of income. Joint elements of income include taxable income from home ownership, taxable income from a substantial business interest, exceptional expenses, and deductible gifts and donations.
• An increase in the personal tax credit for a partner without in come or with low income to the aggregate of the general credit, employment credit, and (supplementary) combination credit applying to this partner. As an exception to the general rule, in this case, the tax credit is refundable in part or in full. However, the payment may not exceed tax and National Insurance contri butions payable by the other partner.
A nonresident taxpayer may not be a partner, unless he or she elects to be taxed as a resident of the Netherlands.
Inheritance tax returns normally must be filed within eight months after the date of death. Gift tax returns should be filed within two months after the date of donation.
E. Double tax relief and tax treaties
The Decree for the Avoidance of Double Taxation provides pro portional relief from Dutch income tax on foreign-source Box 1 income taxed in the country of source and applies for resident taxpayers in the absence of an applicable tax treaty.
Most double tax treaties concluded by the Netherlands provide for double taxation relief, regardless of whether the income is effectively subject to income tax abroad. The relief is usually calculated in accordance with the following simplified formula.
Foreign-source Box 1 income Tax on Amount deducted Worldwide Box 1 income x worldwide = from Dutch tax income
This relief, known as the tax exemption method with progression clause, must be calculated separately for each box of income. Relief for tax on director’s fees may sometimes be calculated according to the less favorable credit method.
It has been announced that the credit method will be mandatory in all cases, most likely as of 1 January 2022.
The Netherlands has entered into double tax treaties with various jurisdictions. The existence of the treaties may affect an applica tion of the national tax law. To determine Dutch individual income tax, residents of the treaty jurisdictions need to refer to the related tax treaty in addition to the general tax provisions. The
Netherlands has entered into double tax treaties with the follow ing jurisdictions.
Albania Greece Panama
Algeria (a)
Hong Kong Philippines
Argentina Hungary Poland
Armenia Iceland Portugal
Aruba India Qatar
Australia Indonesia Romania
Austria Iraq (a) Russian Federation (c)
Azerbaijan Ireland Saudi Arabia
Bahrain Israel Serbia
Bangladesh Italy Singapore Barbados Japan Sint Maarten
Belarus Jordan Slovak Republic
Belgium Kazakhstan Slovenia Bermuda Kenya (a) South Africa
BES-Islands Korea (South) Spain
Bosnia and Kosovo (a) Sri Lanka
Herzegovina Kuwait Suriname
Brazil Latvia Sweden Bulgaria Liechtenstein (a) Switzerland Canada Lithuania Taiwan Chile Luxembourg Tajikistan (c)
China Mainland Malawi (a) Thailand
Croatia Malaysia Tunisia
Curaçao Malta Turkey Cyprus (a) Mexico Uganda
Czech Republic Moldova Ukraine
Denmark Mongolia United Arab Egypt Montenegro Emirates
Estonia Morocco United Kingdom
Ethiopia New Zealand United States
Finland Nigeria Uzbekistan
France North Macedonia Venezuela
Georgia Norway Vietnam Germany Oman Zambia Ghana Pakistan Zimbabwe
(a) The treaty has been signed but it is not yet in force. (b) A new tax treaty has been signed and will enter into force on 1 January 2022. (c) This treaty is withdrawn as of 2022.
F. Visas
Nationals of many foreign countries may not enter the Nether lands unless they have valid passports and visas. Visas may be obtained from the Dutch embassy or consulate abroad.
Individuals coming to the Netherlands for a short term may stay for a maximum period of 90 days in any 180-day period if they have valid passports or other travel documents, as well as visas if required, and if they can prove that they have sufficient financial means to stay in, and to leave, the Netherlands. If these condi tions are met, a residence permit (see Section G) is not required.
G. Residence permits
Foreign nationals wishing to stay in the Netherlands for a period of more than 90 days may obtain a residence permit under any of the following circumstances:
• International agreements require the permitting of entry, for example, to nationals of EU countries and to nationals of countries participating in the EEA (the EEA countries are Iceland, Liechtenstein and Norway) and nationals of Switzerland.
• The presence of the foreign national is in the national interest.
• Permission is granted on humanitarian grounds.
Before the arrival of a foreign national wishing to stay in the Netherlands for a period of more than 90 days, an Admission and Residence (Toegang-en Verblijf, or TEV) application must be submitted. A fee must be paid for the processing of the applica tion.
A legalized marriage certificate for the spouse and legalized birth certificates for the children are needed with respect to the TEV application for dependents. The legalization procedure depends on the country where the event took place. This proce dure can be time-consuming, and applicants should check the requirements at an early stage.
After approval of the TEV application, most nationals must visit the Dutch embassy or consulate in the country of origin or the country of permanent residence to obtain an entry visa (D-visa or MVV).
Nationals of the following jurisdictions do not need to obtain an entry visa from a Dutch embassy or consulate abroad before traveling to the Netherlands for a period exceeding 90 days.
EU member Japan Vatican City countries Korea (South) United EEA countries Monaco Kingdom Australia New Zealand United States Canada Switzerland
After arriving in the Netherlands, a foreign national must visit the Immigration and Naturalization Service (Immigratie- en Naturalisatiedienst, or IND) to collect the residence permit in the Netherlands.
Foreign nationals who want to live in the Netherlands must sat isfy all of the following conditions before they are issued residence permits:
• They must have sufficient means of financial support.
• They must not represent a threat to public order or national security.
• They must have already found work for which a work permit has been, or will be, issued. However, employers of European (EU, EEA and Switzerland) employees are not required to obtain work permits.
EU, EEA and Swiss nationals do not need residence permits to stay lawfully in the Netherlands.
If a foreign national has held a residence permit for five consec utive years, he or she may apply for a permanent residence per mit. For permanent residence permit applications, integration courses must be completed.
Brexit and residence permits. As of 31 January 2020, the United Kingdom has left the EU. Under the withdrawal agreement, there
was a transition period until 1 January 2021. British citizens retained their existing rights during this transition period. During the transition period, British citizens who were registered in the Dutch BRP-registry (in Dutch: Basisregistratie Personen) were invited to apply for a residence permit. After the transition period, a British citizen needs a residence permit and a work permit to continue to work and live in the Netherlands.
Under the EU-UK Trade and Cooperation Agreement (TCA), it is possible for British citizens to travel to the Netherlands for short-term purposes without a visa. Based on the TCA, a work permit exemption can be applicable for short-term travel pur poses.
H. Work permits and self-employment
In principle, all non-European nationals (nationals from coun tries other than EU countries, EEA countries and Switzerland) who wish to be employed in the Netherlands need Dutch work permits. The existing law in the Netherlands seeks to limit the possibilities of Dutch employers’ hiring non-European personnel.
Employers who want to hire foreign nationals must obtain work permits from the UWV WERKbedrijf (public employment ser vice) before the start of the employment. If a work permit has not been obtained, the employer is subject to a fine of EUR8,000 per illegal foreign national.
Grounds for refusal. A work permit is not granted if one of the following compulsory grounds for refusal is met:
• A suitable unemployed person with greater priority is located. Top priority is given to qualified unemployed Dutch people and to qualified unemployed individuals in European countries.
• The vacancy has not been registered with the UWV WERKbedrijf for at least five weeks before the work permit request.
• The employer does not make enough of an effort to find labor within the European labor market.
• A residence permit has not been requested or was not granted.
• The conditions of employment are substandard compared to those of other employees in the same position, and consequently, no one from the European labor market is available to work under such conditions.
• The employer does not pay at least the minimum monthly wage for an adult.
• A foreign national performing the labor is not in the best inter est of the Netherlands.
• A quota applies for the number of work permits to be granted for the activities performed, and this quota has been reached for the specific period.
Certain exceptions to the above compulsory grounds can be made for specific situations, such as the transfer of an employee within an international group of companies (see Intra Corporate Transferees), highly skilled migrants (see Highly skilled migrants) who will bring their specific expertise to the Netherlands and cross-border workers with a valid residence permit from another EU country.
The work permit application may also be denied on other grounds in addition to the compulsory refusal grounds. These
additional refusal grounds include, but are not limited to, the fol lowing:
• It is expected that in the foreseeable future suitable unemployed persons with greater priority will be available.
• The foreign national is younger than 18 years of age.
• No suitable accommodation is available for the employee.
Work permits are not required in certain specific situations, including, but not limited to, the following:
• The foreign national (and his or her partner) has a residence permit for a highly skilled migrant (see Highly skilled migrants).
• The foreign national has a residence permit for an intra-corporate transfer. See Intra Corporate Transferees.
• The employee has his or her permanent residence outside the Netherlands and the employee works only occasionally (for a maximum period of 12 consecutive weeks in 36 weeks) in the Netherlands. The employee’s employment in the Netherlands must involve installing or repairing machinery delivered by an employer located outside the Netherlands, and installing and amending software, including providing or operating the ma chinery and software.
• The employee works for no longer than 13 weeks in a period of 52 weeks in the Netherlands for the purpose of attending busi ness meetings or entering into agreements.
Period of validity. After the conditions for the issuance of a work permit are met, the permit may be issued for different time peri ods. If a work permit is granted after a labor market test, a work permit is issued for one year only. To receive another work per mit, a labor market test should be redone near the end of that year. A work permit based on a transfer within an international group of companies can be granted for maximum of three years. After a five-year period, an employee may qualify for an endorsement on his or her residence permit, stating that he or she is allowed to perform labor and is no longer required to have a work permit.
Population Registrar. Each individual who stays in the Netherlands for more than four months in a six-month period must report his or her home address in the Netherlands to the Population Registrar in the town where he or she is residing. An original and translated legalized birth certificate, an original legalized and translated marriage certificate (if applicable) and a rental con tract for accommodation are required.
If an individual stays in the Netherlands for less than four months in a six-month period, registration is done at the office for shortterm registration (RNI office).
Self-employment. A self-employed person does not need a work permit. However, if a self-employed foreign national applies for a residence permit, the IND asks the Ministry of Economic Affairs whether the self-employed person is allowed to work in the Netherlands.
Highly skilled migrants. To attract highly skilled foreign employ ees to the Netherlands, a special procedure exists for so-called highly skilled migrants. Employers must be accredited sponsors to use the highly skilled migrant procedure. Accredited sponsors must fulfill certain obligations throughout the period in which
the employee is in the Netherlands, and maintain full administra tion regarding the employee for the five years after the end of employment of the individual. Employers can apply to the IND for the status of accredited sponsor. The application fee is EUR4,125 (2021 amount). For companies with less than 50 employees, the fee is EUR2,062 (2021 amount). The status of accredited sponsor is granted for an unlimited time period.
An employer is not required to apply for a work permit on behalf of the highly skilled migrants. The employer needs only to apply to the IND for a residence permit on behalf of the employee. For 2022, an employee must earn a gross monthly salary of EUR4,840 (excluding 8% holiday allowance) or more to qualify for a residence permit as a highly skilled migrant. Employees under 30 years of age must earn a gross monthly salary of EUR3,549 (excluding 8% holiday allowance) or more to apply. The salary levels are adjusted annually.
A special salary requirement applies to highly skilled migrants after an orientation year for highly educated persons (see Orientation year for highly educated persons). A monthly gross salary of at least EUR2,543 (excluding 8% holiday allowance) applies for these highly skilled migrants.
Salary payments must be made through bank transfers to a bank account in the name of the employee on a monthly basis.
The IND commits itself to grant the residence permit (TEV approval, if applicable) within two weeks. The residence permit is granted for a maximum period of five years under the restric tion “highly skilled migrant” and can be renewed.
Football players, spiritual leaders, clerics and individuals perform ing activities in a sexually related business are excluded from the highly skilled migrant category.
If the individual falls within the scope of the Intra Corporate Transferees (ICT) directive, the ICT permit has priority over the highly skilled migrant permit. See Intra Corporate Transferees
Orientation year for highly educated persons. Students who obtained a bachelor’s or master’s degree in the Netherlands or who have graduated from a top university abroad can apply for a Residence Permit Orientation Year for Highly Educated Persons. In addition, scientific researchers may apply for this residence permit.
This type of residence permit can be obtained within three years after completing the studies or after obtaining the PhD. This residence permit is valid for a maximum of one year. The student may work during this year without a separate work permit.
Intra Corporate Transferees. The ICT permit is implemented as of 29 November 2016 and is intended to improve the process by which third-country foreign nationals working for related compa nies abroad come into the EU to work, and to facilitate the mobil ity of such transferees within the EU.
An individual falls within the scope of the ICT directive if the following conditions are met:
• The individual does not have the nationality of an EU member state.
• The individual has his or her main residence outside the EU at the moment of application.
• The individual will serve in the position of manager, specialist or trainee.
The following criteria apply to obtain an ICT permit:
• The individual is coming to the Netherlands to work for a related company with operations in the Netherlands.
• The individual must keep his employment contract with the entity outside the EU.
• The individual must have been employed by the group of com panies for at least three months prior to the assignment.
• The remuneration must be in accordance with Dutch market levels.
Within the framework of intra-EU mobility, subject to certain conditions, the individual can also be transferred to a branch of this company within another EU member state that has imple mented the directive (Denmark, Ireland and the United Kingdom do not participate).
The ICT permit application can be denied on the following grounds:
• The employer or branch in the Netherlands must not have been fined, during the five years immediately before the application, in connection with a violation of Article 2 of the Aliens Employment Act or due to nonpayment or insufficient payment of wage tax, premiums for employee insurance schemes or national insurance premiums.
• There is no existing economic activity between the entity out side the EU and the Dutch entity.
• The employee was resident in the Netherlands immediately before the application based on an ICT permit.
EU Blue Card. The EU Blue Card is intended for employees who perform highly qualified labor within the EU. The EU Blue Card is issued by a certain member state and only gives the right to stay and work in this specific member state. To qualify for the EU Blue Card in the Netherlands, employees must satisfy the month ly gross salary requirement of EUR5,670 (excluding 8% holiday allowance; 2022 amount) or more and must have a diploma showing that the employee has completed a higher education degree program with a duration of at least three years. A foreign higher education diploma must be evaluated. The employee must have an employment contract for a highly qualified position for at least one year.
I. Family and personal considerations
Family members. Dutch law provides for the unification of fami lies. For individuals who plan to bring their spouses and children under 18 years of age to the Netherlands, proof of sufficient means of subsistence and acceptable accommodation is neces sary. Depending on the type of permit for the main application, the partner’s requirements to work in the Netherlands need to be verified. The partner of a highly skilled migrant or ICT may work in the Netherlands without a work permit. As a result, the partner of a highly skilled migrant or ICT is only required to hold a resi dence permit.
Marital property regime. As of 1 January 2018, the default marital property regime in the Netherlands is the limited community property regime. On entering into the marriage, only the property that the spouses build up during the marriage falls within the community of goods. All of the property that the spouses had before entering into the marriage, as well as inheritances and gifts, fall outside the community of property. Only property that is acquired through the effort of both spouses during the marriage is therefore shared. In the event of a divorce, the property that is divided is only the property that had been jointly acquired by the spouses during the marriage. Each spouse retains in divorce the property that he or she had before the marriage.
Marriages before 2018 remain under the former marital property regime of community property. The limited property law applies to heterosexual and homosexual married couples. Other couples who are not married may form a “registered partnership,” but the consequences are less extensive than for married couples (for example, with respect to heirship). If the marital property regime of expatriates working in the Netherlands becomes relevant, the tax authorities respect the regime or the arrangements in the country where they were married.
In addition to potential gift and inheritance tax consequences, the limited community property law may also affect an individual’s personal income tax liability. This is generally the case only for nonresidents who have Dutch-source income taxable in the Netherlands, for example, income from Dutch real estate. If mar ried, this income is allocated between the spouses based on the applicable marital property regime. Under community property, the allocation is 50% to each spouse. If a loss is incurred, it may be carried back or carried forward. If one spouse has no positive income to offset the loss, the carryover does not result in a tax benefit. For tax residents, no personal income tax consequences result from the marital property regime.
Forced heirship rules. Parents may disinherit their children. How ever, a child may always claim his or her legal portion of the estate.
Driver’s permits. In certain cases, a driver’s license obtained out side the Netherlands can be exchanged for a Dutch driver’s license. However, this is only possible if all of the following conditions are satisfied:
• The individual is a Dutch resident.
• His or her foreign driver’s license is still valid.
• He or she has a valid Dutch residence status or permit.
For driver’s licenses issued outside the EU, the following two additional requirements must be fulfilled before an exchange is possible:
• The driver’s license must have been issued in a year in which the individual was resident in the issuing country for at least 185 days.
• The individual must meet the age limit set by Dutch law regard ing the different categories.
To prove that the individual resided for at least 185 days in the issuing country, he or she may provide evidence such as airplane
tickets, a copy of the passport, or an employment statement con taining salary and tax documents.
Within the EU it is possible to exchange an expired European driver’s license. However, for this exception, the individual must obtain a declaration from the issuing authority in which the authority declares that it has no objection to the exchange of the expired driver’s license for a Dutch driver’s license.
Valid driver’s licenses issued in the following jurisdictions can be exchanged.
Alberta (province of Canada) (a) Andorra
Aruba Austria Belgium
BES-Islands Bulgaria Croatia Curaçao Cyprus (b) Czech Republic Denmark Estonia Finland France Germany
Greece Hungary Iceland Ireland Isle of Man Israel (a) Italy Japan (a) Jersey Korea (South) (a) Latvia Liechtenstein Lithuania Luxembourg Malta Monaco Norway
Poland Portugal (Azores and Madeira)
Québec (province of Canada) (a) Romania Singapore Sint Maarten Slovak Republic Slovenia Spain (Canary Islands) Sweden Switzerland Taiwan (a) United Kingdom
(a) For these jurisdictions, a valid foreign driver’s license can be exchanged only for a Dutch driver’s license if the foreign driver’s license is valid in a specific category.
(b) It is only possible for the Greek part, not the Turkish part.
It is not possible to exchange an international or European driv er’s license for a Dutch driver’s license. Only the original driver’s license issued by the proper authorities from the country of issue can be exchanged. Every driver’s license is checked for validity and authenticity. This means that the person may have to prove its soundness by asking the embassy or the consulate of the country where the license was issued for a confirmation for the Dutch authorities. The person may also be requested to have his or her driver’s license translated by an attested translator.
Exam to retake the driving test. If the abovementioned conditions are not met or if the 30% tax facility does not apply (see Special rule for driver’s license procedure in case of the 30% facility), the individual must take the regular theory and practical test. The exam is administered by the Central Office for Motor Vehicle Driver Testing (in Dutch: Centraal Bureau Rijvaardigheidsbewijzen, or CBR).
Special rule for driver’s license procedure in case of the 30% facility. An individual who benefits from the 30% facility and his or her family members can directly apply for a Dutch license at the local Dutch municipal office without taking a driving test. To exchange the foreign driver’s license for a Dutch driver’s license, the individual must go to the local Dutch municipal office. He or
she must at the moment of application pay a fee (the amount var ies) and submit the following:
• The completed and signed request form (3 E 0397). A “User manual Application for the exchange of a foreign driving licence for a Dutch driving licence” can be found on the gov ernmental website (www.rdw.nl).
• A copy of the statement issued by the International Tax Office in Heerlen proving that the individuals or another member of his or her family is entitled to benefit from the 30% facility.
• The individual’s original, valid foreign driver’s license, issued in a country where he or she has been a resident for longer than a period of 185 days (the individual must hand in the license).
• An extract from the municipal register, proving that the indi vidual is registered and stating his or her address in the Netherlands.
• A Certificate of Capability, which is a questionnaire available at the local government office. To obtain a Dutch driver’s license, the individual must fill out a personal declaration, which is required by the CBR. A medical team reviews this declaration and decides whether the individual gets the driver’s license.
• One passport photograph in a color that meets the demands of the Fotomatrix Model 2020. An overview of these criteria can be obtained from the governmental website (www.rijksoverhe id.nl).
• Under certain circumstances, a translation of the individual’s driver’s license by an attested translator (for example, if written in Chinese characters or in Cyrillic writing). This is needed when the text on the foreign license consists of characters that are not used in the Netherlands.
The individual must hand in his or her foreign driver’s license at the moment of application and is not allowed to drive until the Dutch permit is issued. The foreign license will be returned by the municipality to the country of issuance.