The 30%-ruling is a tax facility provided in the Wage Tax Act for employees who have been seconded to the Netherlands or recruited from abroad to work in the Netherlands and who meet certain conditions. These employees are referred to as ‘extraterritorial employees’. If the facility is granted, the employer may pay the employee a – fixed – tax-free allowance of up to 30% of the employee’s employment income.
A request for the application of the 30%-ruling will only be granted if the employee and the employer jointly file an application with the Tax Office.
The application for the 30%-ruling must be filed within four months from the start of the employee’s employment (first working day).
For the 30%-ruling to apply, the employer and employee must agree (in writing) that a separate tax-free allowance for extraterritorial expenses will be paid in addition to the gross salary, amounting to (at a maximum) 30% of the remuneration.
The ruling applies for a maximum period of eight years, as long as the employee meets the requirements of the 30%-ruling (which will be verified continually).