The 30% ruling is the single most valuable tax benefit available to expats in the Netherlands, and it has been the most politically contested. Between 2024 and 2026, the structure changed three times — first reducing the maximum duration, then introducing tapering, then partially reversing some of the changes after political pushback. The result is a system that is both still worth using and meaningfully less generous than it was for expats who arrived before 2024.
What the ruling does, briefly
The 30% ruling allows your Dutch employer to pay up to 30 per cent of your salary as a tax-free reimbursement for the "extraterritorial costs" of living and working abroad. The remaining 70 per cent is taxed normally. The net effect is significantly higher take-home pay than a non-ruling expat earning the same gross salary, particularly at higher income levels where the top tax rate of 49.5 per cent applies.
The 2024 changes
Until 2024, the ruling was a flat 30 per cent of salary for up to eight years, then five years after a 2019 reform. The 2024 changes introduced tapering: 30 per cent for the first 20 months, 20 per cent for the next 20 months, and 10 per cent for the final 20 months. The total duration remained 60 months (five years), but the average benefit over those five years dropped from 30 per cent to 20 per cent. For someone earning €100,000 with a five-year horizon, this represented a meaningful reduction in lifetime tax savings — roughly €40,000–€50,000 over the period.
The 2026 partial reversal
Following political pushback from major employers (notably ASML, Philips, and several life-sciences firms) and academic institutions warning that the ruling was no longer attractive enough to retain international talent, the 2026 tax plan (Belastingplan 2026) softened the tapering. The structure is now: 30 per cent for the first 30 months, 25 per cent for the next 30 months. Total duration remains 60 months, but the second half is 25 per cent rather than 20 per cent + 10 per cent. The change applies to applications submitted from 1 January 2026 onward; people already in the ruling under the 2024 tapering schedule remain on that schedule unless they elect to switch (which is generally beneficial and is handled by your employer's payroll provider).
What the salary thresholds look like in 2026
To qualify, you must meet a minimum taxable salary threshold. In 2026, this is €46,107 gross per year for the standard category and €35,048 for employees under 30 with a master's degree. These thresholds are indexed annually and represent the salary after the 30 per cent is taken out — so the gross salary required is roughly 1.43 times these figures (€65,867 and €50,069 respectively).
The 150km rule
You must have lived more than 150 kilometres from the Dutch border for at least 16 of the 24 months immediately before your first day of Dutch employment. This rules out applicants from most of Belgium, parts of western Germany, and Luxembourg. The 150km is measured as a straight-line distance from your home address to the nearest point on the Dutch border, not driving distance. The rule is intended to ensure the ruling goes to genuine international relocations rather than cross-border workers.
Application process and deadlines
Your employer applies on your behalf to the Belastingdienst using the joint application form. The application must be submitted within four months of your Dutch start date for the ruling to apply retroactively to day one. After four months, the ruling can still be granted but only from the month following the application submission, meaning you lose whatever portion of the year falls before that. Applications are typically processed in four to eight weeks.
Partial non-resident taxpayer status
Beyond the tax-free salary portion, holders of the 30% ruling can elect to be treated as partial non-resident taxpayers for Box 2 and Box 3 income. This means foreign-held assets (savings, investments, second homes outside the Netherlands) are not included in the Dutch wealth tax calculation. For expats with significant overseas assets, this is often more valuable in absolute terms than the income tax benefit itself. The election is made annually on your tax return and cannot be retroactively changed.
Strategic considerations
If you are negotiating a Dutch employment offer, the 30 per cent ruling significantly affects how to think about gross salary. A gross salary of €80,000 with the ruling produces roughly the same net income as €100,000–€105,000 without it, depending on family situation. Employers know this and sometimes negotiate gross salaries assuming the ruling is granted. Have a clear understanding with your employer of what happens if the ruling is refused (which is rare but happens) — your net pay would be substantially lower than expected.
Will the ruling survive longer term?
The political consensus around the 30 per cent ruling has softened in recent years. Smaller left-leaning parties have called for its abolition; centre-right and business-aligned parties defend it as essential for talent attraction. The most likely trajectory is incremental adjustment rather than abolition: tighter thresholds, possibly shorter durations, but the basic structure is likely to remain in some form for the foreseeable future. Plan around the current rules and adjust if the law changes.
Should you switch schedules?
If you entered under the 2024 rules you sit on the 30/20/10 taper, averaging 20% across five years, while new entrants from January 2026 get 30/25, averaging 27.5%. Where switching is available it is usually advantageous, but the size of the gain depends on where you are in your five years.
Someone early in their term captures most of the benefit, because the bulk of their remaining months would otherwise fall in the 20% and 10% blocks. Someone in their final year has little left to improve. The mechanics run through your employer's payroll provider rather than through you, so the practical step is to ask payroll to model both schedules against your actual remaining months before deciding.
What the change means if you are negotiating an offer
The reversal materially improves the value of a Dutch offer for new arrivals, and it is worth being precise about the numbers when comparing packages.
A candidate weighing Dutch and non-Dutch offers should model net rather than gross across the full five years, because the ruling's value declines on a schedule. Modelling year one and extrapolating overstates the benefit. Our main 30% ruling guide covers the eligibility tests, the four-month application deadline, and what happens if you change employer mid-term — all of which affect what an offer is actually worth.
Why this keeps changing, and what that means for planning
The ruling has now moved three times inside three years, in both directions. The underlying tension is durable: the facility is expensive and politically exposed as a benefit for high earners, while employers and universities argue it is necessary to compete for international talent. That tension will not resolve, which means further adjustment is more likely than not.
The planning implication is modest but real. Treat the ruling as a valuable feature of a Dutch package rather than a fixed entitlement you can commit to for five years — particularly when making decisions with long tails, such as a mortgage sized on ruling-inflated take-home pay. Our mortgage guide explains how lenders treat the ruling's finite life.