Netherlands Tax Recovery.

If you are employed or want to start working in the Netherlands, you have probably started looking for information on how you will be paid, what taxes you will be required to pay and what are the best ways to earn as much money as possible without being required to pay certain avoidable taxes and duties. There are certain methods for a fully legal Netherlands tax recovery.

We have prepared a complete, specially structured guide for a person who wants to start working in the Netherlands as an employee. If you want to know how to avoid certain taxes, and how you can complete some declarations so as not to pay almost 50% tax.

Netherlands Tax Recovery - How the Dutch tax system works

As in most civilized states, the Netherlands has a tax system similar to the rest of the world. Without going into too much detail, you should know that for any income you make, it is mandatory to pay tax. If you want to start a Netherlands tax recovery process, you need to check if you are eligible to do so. Although it is perfectly legal to get your taxes paid back, not every employee can do that.

Depending on your job, employment contract, or the conditions under which you are employed in the Netherlands, these taxes may or may not be recovered. Here are the conditions under which YOU COULD recover your taxes:

• Your last job was for a short time
• In addition to the job you have now, you are also employed by another company
• You changed jobs
• 30% tax rule - You have received from your employer an expense allowance that exempts you from taxes of up to 30% of your salary
• You are considered a non-revenue tax partner. In this context, your partner should be the one who has the income and pays the taxes
• You bought a property with the help of an interest-bearing mortgage loan
• You are forced to incur medical expenses due to an illness
• The commute to work is more than 10 km. This journey must be made by public transport. This is only valid if your expenses have not been reimbursed.
• Your child under the age of 12 lives in the same apartment as you
• You had a part-time work schedule

 

The real reasons why your taxes will be refunded

The list above contains everything you need to know about yourself before attempting to fill out Netherlands tax returns. If you fall into one of the categories described above, you will be able to recover some or all of the taxes paid for the income you earned.

The Dutch tax system is very efficient, but there is this methodology by which taxes are applied based on an annual salary calculation. So, if you have not worked for 12 months of the fiscal year, you will have the right to claim a refund of taxes and duties.

What is the 30% tax rule and how do I know if I am eligible?

Although in the first phase you would think that the only way you can get this allowance is if you ask the employer, we have good news for you. The allowance is granted quite simply as long as you meet the necessary conditions. This allowance exempts you from paying the tax for the 30% tax rule of the salary, 30% being the maximum percentage. This allowance is one of the most affordable tax recovery methods in the Netherlands. Here's how to find out if you're eligible:

• The employer you work for pays tax on the salaries of its employees
• You came to work in the Netherlands from another country
• If your job is considered to be part of limited expertise in the Netherlands
• The tax authorities have issued a notice stating that you can receive the 30% allowance

 

Netherlands tax collection whether you are a resident or not

You will see in the following paragraphs that it is very important to know what statements to complete and how. Each statement is specifically designed for a specific category of employees. The main distinction that will be made between the documents that will have to be submitted by you for Dutch tax recovery is the title of the resident. If you are a resident you will fill in a declaration, if you are not, you will fill in another declaration.

How do I know if I'm a resident or not?

• If you are currently working in the Netherlands and your employer has registered with an address in the Netherlands, this is proof that you are a resident.
• If you work in the Netherlands but live at an address outside the country, you will be a non-resident.
• If you arrived in the Netherlands or moved to work in the middle of the fiscal year, you will be considered a migrant.

 

Filling out tax forms in the Netherlands

If you have moved to the Netherlands and working as an employee, you will certainly receive a letter from the Dutch state requiring you to complete the tax return based on which your taxes will be refunded or you will be forced to pay taxes. These things differ from person to person, and the values ​​are higher or lower depending on the salary for which you are employed.

Belastingdienst - If you see this name on a letter or in an envelope that you received where you live, you need to know from the beginning that it is an important envelope. Belastingdienst is the state institution that deals with all aspects of taxation, taxes, and duties due to and from employees.

To ensure that you do everything right, we recommend that you submit your statement using the online platform dedicated to this. To be identified online by the Dutch state, a DigiD must be generated. You should expect this DigiD to take several weeks. The application for a DigiD must also be made through Belastingdienst.

What are the statements to be submitted?

To be able to move to an efficient Dutch tax recovery process, we have thought of providing you with some details on the names of the declarations to be submitted. You will not have to submit them all, you just need to know which statement is right for you.

1. P-form: for those who have lived in the Netherlands throughout the tax year and are in a regular employment situation (resident taxpayers);
2. E-form: a simpler version of the P form that mentions only the essentials
3. M-form: for those who have lived in the Netherlands only part of the year; as well as persons who immigrated or emigrated from the Netherlands a year earlier. This type of form cannot be completed online but can be requested online.
4. C-form: for those who do not currently live in the Netherlands but earn income from the Netherlands (non-resident taxpayers);
5. W-form: for freelancers
6. F-form: for the relatives of a deceased person

 

When do you have to file your tax return?

Usually, the letter stating that you must file your tax return will be sent to you by the state institution. If by any chance you do not receive a letter from Belastingdienst, you will need to apply for a form yourself.

 

Have you ever thought about building your career in the naval, industrial, logistics, or construction field in the Netherlands? If the answer is yes, we are here to make your dream a reality! The DB Work team is waiting for you to send your CV to the email address job@dbwork.com. Make sure you don't miss any opportunities and explore our daily list of available job positions. As for the benefits of a DB Work intermediary contract in the Netherlands, all this information is available in our comprehensive article.