This special tax regime is applicable for inbound employees providing certain requirements are met whereby the employee is entitled to a maximum of 30% of their income to be tax free.
This is of particular interest to international freelancers and contractors as it is aimed at professionals with specific expertise within certain salary parameters which are variable dependant on their particular area of expertise.
As this is an ongoing assessment careful consideration has to be given to a number of factors to ensure that the requirements are continuously met, such as salary norm. For instance even unpaid leave can threaten your entitlement to this allowance. It should be noted that this applies to current employment and does not cover areas such as severance pay.
In order to avail from this benefit it should be granted by the Dutch tax authorities and formalized in the employment contract or recorded in an employment addendum. If entering into a new employment contract this can be continued providing that all the requirements are still met. Periods of unemployment whilst in The Netherlands can result in the 30% ruling being stopped permanently.
This is only a brief summary of all the factors and if you are currently or considering contracting in The Netherlands and would like further information on how this can effect or benefit you then please do not hesitate to contact us.