The Dutch 30% ruling for expats will be adjusted in accordance with the Dutch cabinet’s new Tax Plan 2023.
The “Balkenende norm,” which will be €223,000 in 2023, will serve as the incentive’s upper (salary) level starting in 2024.
Under certain conditions, foreign workers who come to the Netherlands to work may receive up to 30% of their salaries tax-free as compensation for the additional expenses they incur. The Tax Plan 2023, which contains a suggestion to limit the program to the so-called Balkenende norm, also known as the Wet normering topinkomens (WNT) norm, or the maximum salary for senior officials as stipulated in the Top Income Standards Act, was handed by the administration to the House of Representatives on “Prinsjesdag.”
The WNT’s maximum salary will be € 223,000 in 2023. The amount for 2024 is not yet known. The 30% facility may only be used to reduce that amount beginning in 2024. This would indicate that, prior to 2023, a business may provide tax-free compensation to employees up to a maximum of € 66,900 (30% of € 223,000).
Temporary measure capping the 30% ruling
The government proposes a transitional solution in which the capping of the 30% ruling begins only on 1 January 2026, for newly hired employees to whom the 30% ruling was applied for the final salary period of 2022. As soon as you access the 30% ruling (after 1 January 2023), you are aware that the maximum amount to be considered may be capped as of 1 January 2024. As a result, they have no interim plan in place.
The 30% ruling for expats
Foreign employees frequently incur additional costs for their period spent working in the Netherlands. There is a special exemption in the work-related costs scheme that applies to the reimbursement of certain extraterritorial costs, such as housing costs, if the employer registers the genuine costs per employee in the payroll administration. However, in some cases, an employer may choose to repay up to 30% of the wage tax-free, reducing the amount of administrative work. Employers can choose this 30% rule, but only under certain conditions. Read more here.