The 30% Ruling: How the Dutch Expat Tax Benefit Actually Works

The Official Rule

The 30% ruling (30%-regeling) lets an employer pay up to 30% of an eligible employee’s gross salary as a tax-free allowance, meant to offset the extra costs of working outside your home country, rather than taxing the full salary and requiring you to itemize actual relocation expenses separately.

According to Business.gov.nl, the official government business portal, the core eligibility requirements are:

• You’re recruited or transferred from abroad into Dutch employment.
• You have specific expertise that is scarce in the Dutch labour market, which in practice is demonstrated simply by clearing the minimum salary threshold, there’s no separate skills or degree exam on the standard route.
• You lived more than 150 km from the Dutch border for at least 16 of the 24 months before starting your Dutch job.
• You have a genuine employment relationship with an employer who withholds Dutch payroll tax.
• The Belastingdienst grants the ruling in a written decision, applied for within 4 months of your start date to have it backdated.

The ruling runs for a maximum of 5 years, a shorter window than the 8 or 10 years it used to allow under older versions of the scheme.

The 2026 Numbers

The salary cap matters even if your income comfortably clears the minimum threshold: according to LIMES international’s 2026 salary threshold overview, the WNT norm limiting how much of your salary the ruling can apply to rose to 262,000 euros in 2026, up from 246,000 euros in 2025. Anything above that cap is taxed normally, the 30% benefit doesn’t extend to it.

Why the Rate Change History Is Confusing, and What Actually Happened

This is the part that trips people up, because the rules changed twice in quick succession. Here’s the actual sequence:

1. Before 2024The ruling paid a flat 30% for its full term (then up to 8 years, later shortened to 5), with no salary cap on how much income it applied to.
2. 1 January 2024A salary cap (the WNT/Balkenende norm) was introduced for the first time, limiting how much income the 30% benefit could apply to. At the same time, a gradual stepdown was announced: 30% for the first 20 months, 20% for the next 20, then 10% for the final 20 months of the 5-year term.
3. Budget Day 2024 (September 2024)According to [Loyens & Loeff's analysis](https://www.loyensloeff.com/insights/news--events/news/from-a-30-ruling-to-a-27-ruling-relaxation-or-restriction/), the 30/20/10 stepdown plan was scrapped after criticism that it made the Netherlands less competitive for attracting international talent.
4. 2025-2026The rate stayed at a flat 30% for these two years, per [Baker Tilly's summary of the adjusted scheme](https://www.bakertilly.nl/en/inzichten/kennisartikel/expat-scheme-adjusted-not-30-not-30-20-10-but-a-27-ruling).
5. From 1 January 2027The rate drops to a flat **27%** for rulings that started after 1 January 2024, replacing the scrapped stepdown with a single, simpler cut.

Transitional protection exists but is partial. If your 30% ruling was already granted before 1 January 2024, you keep the 30% rate after 2027 rather than dropping to 27%, for the remainder of your term. But the salary cap’s own transitional exemption expired on 1 January 2026, so even people under the older, protected arrangement are now subject to the WNT salary cap from 2026 onward. The rate protection and the cap protection are two separate things, and only one of them still applies going forward.

Photo by cottonbro studio on Pexels

What Real People and Advisors Flag

Tax advisory guides consistently highlight the same practical points worth knowing before you assume the ruling applies cleanly to your situation:

• The 150km rule is stricter than it sounds. It’s not about your nationality or passport, it’s about where you actually lived for 16 of the 24 months before starting your Dutch job. Someone who already lived in a Dutch border region, or who moved to the Netherlands from a nearby country shortly before taking the job, can fail this test even if they’re clearly an international hire in every other sense.
• You get to choose between the flat percentage and actual costs, but not both. According to multiple advisory guides, employees can opt for reimbursement of documented, real extraterritorial expenses instead of the 30% allowance, but not combine the two. For most people the flat percentage is simpler and more generous, but it’s worth running the comparison if your actual relocation costs were unusually high.
• Losing partial non-resident taxpayer status changed things starting 2025. Guides note that 30%-ruling holders used to be able to opt for partial non-resident tax status (mainly relevant for savings and investment income taxed in Box 3), and that option was removed for new rulings from 1 January 2025, a detail worth discussing with a tax advisor if you have significant assets outside the Netherlands.

Step by Step

1. Confirm you meet the core eligibility: recruited from abroad, the 150km/16-of-24-months residency test, and a real Dutch employment contract.
2. Check your salary against the current threshold (roughly 48,013 EUR for 2026, or 36,497 EUR if under 30 with a qualifying master’s), and against the 262,000 EUR salary cap if your income is high.
3. Apply through your employer within 4 months of your start date to the Belastingdienst, so the ruling can be backdated rather than starting from a later month.
4. Decide between the flat 30% allowance and actual cost reimbursement, comparing which is more favorable for your real situation.
5. Track the 2027 rate change if your ruling started after 1 January 2024, since your take-home benefit will shift from 30% to 27% at that point unless you fall under the pre-2024 transitional protection.
6. Revisit your situation with a tax advisor if you have significant non-Dutch assets or investment income, given the 2025 change to partial non-resident taxpayer status.

What You’ll Need

• A Dutch employment contract with an employer who withholds Dutch payroll tax.
• Proof of your residence history for the 24 months before your Dutch job started.
• Payslips or salary documentation showing your taxable wage clears the applicable threshold.
• A BSN, since it’s required for essentially all Dutch tax and payroll processes.
• A completed application submitted by your employer to the Belastingdienst, ideally within 4 months of your start date.

Compliance Note

This page explains the general 30% ruling framework and 2026 figures as published by the Dutch government and reported by tax advisory firms, current as of 2026. It is not personal tax advice. Eligibility, thresholds, and the rate schedule can change, and your specific situation, prior residence, salary structure, and start date all affect what actually applies to you. Confirm your case directly with your employer’s payroll department, a licensed Dutch tax advisor, or the Belastingdienst before relying on any figure here.