Tax Residency

Information about the income tax rulings for residents, partial non-residents and non-residents in the Netherlands...

The taxpayer’s circumstances and registration at a municipality are of great importance in determining fiscal residency. The following facts and circumstances can be relevant when determining tax residency in the Netherlands:

  • Where is the taxpayer’s permanent home situated?
  • Where are the taxpayer’s financial and social bonds strongest?
  • What are the intentions of the taxpayer?

There are three types of tax statuses:

  • Resident
  • Partial non-resident
  • Non-resident

Resident for tax purposes

When a taxpayer has registered at a municipality in the Netherlands they are treated as a resident for tax purposes. A resident taxpayer in the Netherlands is taxed on worldwide income and is eligible to claim the following personal tax deductions, if applicable:

  • Alimony payment to former spouse
  • Payments for supporting children under 21 years old
  • Expenses for illness (including costs of diet by medical orders), decease or disability
  • Expenses for visits on the weekend by seriously disabled children
  • Expenses for studies for the taxpayer and/or their spouse
  • Expenses for maintenance of houses under protection of monuments
  • Donations to charitable institutions

Allowances

Resident taxpayers can also request certain allowances if they meet the conditions that apply.

There are four types of allowances that can be claimed:

  • Rent
  • Health Care
  • Child (not from the SVB)
  • Day-care

Child benefit

Dutch child benefit is also available for people living and working in the Netherlands who have a child. In order to be eligible for this benefit applicants must:

  • Hold a valid residence permit, and
  • Hold a work permit if not from an EU country or Switzerland, and
  • Not have a secondment certificate from another country

The Social Insurance Bank (SVB) provides information regarding Dutch child benefit.

Partial non-resident for tax purposes

Qualification as partial non-resident is only applicable if the 30 percent ruling is granted. This status means that taxpayers are taxed as a resident taxpayer in Box 1 (income from work and principal residence) and as a non- resident taxpayer with respect to the other two tax boxes.

Non-resident for tax purposes

A non-resident taxpayer is an individual who is not treated as a resident taxpayer in the Netherlands. Therefore, they are taxed on worldwide income elsewhere. A non-resident taxpayer will pay tax only on income that can be allocated to the Netherlands.

The information provided here is of a general nature and should not be misconstrued as individual advice. For a detailed expert analysis of your situation, contact the author of this article:

mr. Quintin Eadie

Belastingadviseur
Tax Advisor
 
Olof Palmestraat 24
2616 LS Delft
T.: +31 (0)15 215 88 15
D.: +31 (0)15 820 00 69
W.: www.aame.nl