The 30 per cent ruling is worth roughly fifteen per cent of gross pay to a higher earner, and the most common way to lose it is a four-month deadline that starts the day you begin work.
This guide sets out the 2026 thresholds, the conditions, the change coming in 2027, and the two elections that decide how much the ruling is actually worth to you.
What It Does
An employer may pay up to 30 per cent of your salary as a tax-free allowance for extraterritorial costs, without you having to evidence a single euro of those costs.
The mechanism matters for what follows: your taxable salary drops by that share, so the saving is made at your top marginal rate - 49.5 per cent for most people who qualify.
The maximum duration is five years, reduced from eight in 2019, and any earlier period spent in the Netherlands in the preceding 25 years is deducted from it.
The Four Conditions
Recruited from abroad. You must have been hired from outside the Netherlands, or transferred here by your employer, rather than already living here and finding a job.
The 150-kilometre rule. For at least 16 of the 24 months before your first working day, your home must have been more than 150 kilometres from the Dutch border - which excludes most of Belgium and a strip of Germany.
Specific expertise, measured by salary. For 2026 your taxable salary after the exemption must be at least €48,013, or €36,497 if you are under 30 and hold a master’s degree recognised as equivalent to a Dutch one.
The reduced threshold ends the month you turn 30, and the salary test is applied continuously rather than once.
A joint application. Employer and employee apply together to the Belastingdienst, and the employer has to be a Dutch withholding agent.
The Deadline That Costs People Money
Apply within four months of your first working day and the ruling is backdated to that day.
Apply after four months and it takes effect from the first day of the month following the decision, and the intervening months are simply gone.
Processing has historically taken several weeks to a few months, and the ruling applies retroactively once granted, so a slow decision is not a problem and a late application is.
If you change employer, the ruling does not travel automatically: a fresh application is needed, and the gap between jobs must be no more than three months or the entitlement ends entirely.
Three months and one day between contracts is one of the few genuinely unrecoverable mistakes in Dutch tax.
The Ceiling And The 2027 Cut
The exemption may only be applied to salary up to the Balkenende norm, about €262,000 in 2026, so above roughly that level the relief stops growing.
From 1 January 2027 the percentage falls from 30 to 27 per cent for everyone still within the scheme.
There is transitional protection: employees to whom the ruling already applied in 2024 keep the 30 per cent rate and the older, lower salary criteria for the remainder of their five years.
If you started in 2025 or later, plan on 27 per cent from 2027 and on the higher salary thresholds.
Partial Non-Resident Status
Holders of the ruling may elect to be treated as a partial non-resident, which takes Box 2 and Box 3 income largely outside Dutch tax while Box 1 employment income stays fully taxable here.
For someone with a meaningful investment portfolio abroad this election is often worth more than the 30 per cent exemption itself, because Box 3 charges tax on a deemed 6 per cent return on investments regardless of what they earned.
The election is made in the annual return rather than in the ruling application, and it is one of the few Dutch tax choices genuinely worth modelling before you make it.
What It Is Actually Worth
On a €90,000 salary, 30 per cent - €27,000 - is paid free of tax, and because that slice would otherwise be taxed largely at 49.5 per cent, the saving lands in the region of €12,000 a year.
At €60,000 the exempt slice is €18,000, more of it falls in the 37.56 per cent band, and the saving is correspondingly smaller.
Two consequences are worth naming, because they are not obvious.
Your pension accrual and any income-linked benefit are calculated on the reduced taxable salary, so a lower pension is part of the price.
An employer can also offer to reimburse actual extraterritorial costs instead of using the flat 30 per cent, and where school fees for international education are involved that can be the larger figure.
Frequently Asked Questions
What salary do I need in 2026?
€48,013 taxable after the exemption, or €36,497 if you are under 30 with a qualifying master’s degree.
The lower figure stops applying in the month you turn 30, and the test is checked continuously rather than once at the start.
How long do I have to apply?
Four months from your first working day for the ruling to be backdated to that day.
Later applications start from the month after the decision, and the months in between are lost.
How long does it last?
Five years, less any period you previously spent in the Netherlands within the preceding 25 years.
What happens if I change jobs?
A new joint application is required with the new employer, and the gap between contracts must not exceed three months.
Exceed it and the entitlement ends for good.
Is the percentage really dropping?
Yes - to 27 per cent from 1 January 2027, with the 30 per cent rate and the older salary criteria preserved for people to whom the ruling already applied in 2024.
Should I elect partial non-resident status?
It is worth it if you hold significant investments or a substantial company interest, because it takes Box 2 and Box 3 largely out of Dutch tax.
It changes nothing for someone whose only income is a Dutch salary.
