Tax Allowances in the Netherlands

The Netherlands is a very appealing country from a taxation point of view and it attracts many foreign citizens every year. The Dutch tax system provides for several tax allowances for individuals working here and for investors who own businesses in the Netherlands.

While Dutch companies benefit from various tax deductions, exemption, and reductions, individuals are subject to the box taxation system through which several allowances are granted.

Our Dutch company formation agents can help investors who want to open companies here.

What are the main tax allowances available for Dutch residents?

Foreign citizens moving to the Netherlands can benefit from several tax allowances, among which:

• -          the healthcare allowance – it is mandatory for each individual living in the Netherlands to have a health insurance;
• -          the childcare allowance which is a help granted by the government to parents with children in school;
• -          the rental allowance which is a contribution through which the government partially supports housing costs;
• -          the child budget allowance is another allowance granted to parents raising children with ages below 18.

Apart from these, there are also several tax benefits offered by the government to individuals residing and working in the Netherlands.

We remind business owners that we also offer corporate accounting services in the Netherlands.

Tax benefits for Dutch residents

Dutch residents can also benefit from two important tax benefits:

• -          the labor tax credit;
• -          the general tax credit.

Foreign individuals can also benefit from the 30% tax ruling.

Deductible expenses in the Netherlands

The following expenses can be deducted by those residing in the Netherlands:

• -          public transportation services used to commute from one city to another can be deducted;
• -          the expenses incurred by raising children younger than 21 years old – these expenses depend on the number of underage children;
• -          various losses from work, such as temporary disability and medical expenses incurred by work accidents;
• -          the maintenance and costs incurred by renting or owning a house in the Netherlands;
• -          donations, venture capital loans and other types of investments subject to special tax rules.

For full information on the Dutch taxation system, please contact us. We can also help you open a company in the Netherlands.