30% ruling for expats and employers

Are you recruiting an international employee or moving to the Netherlands as an expat? Practical manages the 30% ruling, also known as the expat ruling, from the initial assessment and application to the Tax Administration (Belastingdienst) through to payroll processing after approval.

Where relevant, our payroll and tax specialists align this with the Dutch income tax return and employer administration. In this way, a single team monitors the connection between the employment relationship, payroll taxes, payroll, and tax returns.

What is the expat ruling (30% ruling)?

The expat ruling, also referred to by the Tax and Customs Administration and the National Government as the 30% ruling, is a tax facility for employees who temporarily come to work in the Netherlands from abroad and who possess specific expertise that is scarce or unavailable on the Dutch labor market. The ruling makes it possible to provide a portion of the salary as a tax-free allowance for the extra costs of working outside the country of origin, the so-called extraterritorial costs. The precise conditions under which the ruling applies depend on the year and the individual situation of the employee. You can read the conditions for 2026 below.

What are the conditions and salary standards for the 30% ruling in 2026?

For the 30% ruling, the employee must be in salaried employment, recruited from abroad, and possess specific expertise. Additionally, in the 24 months prior to the first working day in the Netherlands, the employee must have lived more than 150 kilometers from the Dutch border for more than 16 months.

In 2026, a taxable annual salary of more than €48,013 applies, excluding the tax-free allowance. For employees under the age of 30 with a Dutch academic Master's degree or an equivalent foreign degree, a reduced salary standard of more than €36,497 applies.

No salary standard applies to scientific researchers at designated institutions and doctors in specialist training. The other conditions remain applicable.

How do you apply for the 30% ruling?

Employer and employee jointly apply for the 30% ruling to the Tax Administration. Practical manages the process from the initial assessment and preparation of the application to the processing in the payroll administration after the granting decision.

Practical experience

See how an entrepreneur experiences the collaboration with Practical when making decisions with financial and tax consequences. The video shows how figures, specialist expertise, and personal advice come together for the business.

What happens to the 30% ruling when changing employers?

When changing employers, the 30% ruling does not always continue automatically.
If the employee changes employers within the same coherent group of withholding agents and continues to meet the conditions, the existing granting decision remains valid. A new application is then not required.

When moving to an employer outside this group, the employee and the new employer must jointly submit a new application. The new employment must start within three months of the end of the previous employment. If the application is submitted within four months of the start, the ruling can be applied from the first working day with the new employer.

Practical assesses the transition, monitors the deadlines, and aligns the application, granting decision, and payroll administration.

30% ruling and Dutch payroll for international employers

Under certain conditions, the 30% ruling allows an employer to provide a tax-free reimbursement of up to 30% of the salary including the allowance. The outcome depends on factors such as the income standard, salary agreements, duration, and the statutory maximum.

Practical | Excellence in Finance manages the full Dutch process: from assessment and application to processing in the payroll administration, payroll tax returns, and Dutch income tax. We assess changes in salary, position, employer, or duration in a timely manner.

International employers without a Dutch branch may also have Dutch employer obligations. Practical provides support where necessary with registration as a foreign employer, Dutch payroll, and payroll taxes.

For US citizens and Green Card holders, we align the Dutch payroll and tax return with specialized US tax advisors for the federal and any state tax returns. This creates a single, coherent Dutch-US tax file.

30% ruling: one team for application, payroll, and tax returns

Practical manages the 30% ruling as one continuous process. We assess the conditions, prepare the joint application of employer and employee, and process a valid granting decision in the Dutch payroll administration.

Subsequently, we monitor the salary standard, duration, and the consequences of changes, such as a move to another employer. Where relevant, we also handle the Dutch income tax return and, for US citizens and Green Card holders, the US tax return.

This ensures that the granting decision, payroll, payslip, and tax returns remain aligned.

Frequently Asked Questions

What is the expat ruling (30% ruling)?

The expat ruling is a tax scheme for employees recruited from abroad to work in the Netherlands. With a valid granting decision, the employer can reimburse a maximum of 30% of the salary including the allowance tax-free for extraterritorial costs in 2026. Thirty percent is a maximum; the employer is not obliged to apply the full percentage.

What is the salary standard for the 30% ruling in 2026?

In 2026, the taxable annual salary, excluding the tax-free allowance, must be higher than €48,013. For employees under the age of 30 with a qualifying academic Master’s degree, a reduced standard of more than €36,497 applies. No salary standard applies to scientific researchers at a designated institution and doctors in specialist training.

Which conditions must an employee meet?

The employee must, among other things, be in salaried employment, be recruited from outside the Netherlands, and possess specific expertise. Additionally, in the 24 months prior to the first Dutch working day, the employee must have lived more than 150 kilometers from the Dutch border for more than 16 months. Previous work or residence in the Netherlands may affect the assessment.

How much can be reimbursed tax-free and how long does the ruling apply?

The granting decision has a maximum duration of five years. Previous periods of work or residence in the Netherlands can shorten this duration. In 2026, the maximum tax-free allowance is €78,600 for a salary of €262,000 or higher and application during the full year. For application during part of the year, the maximum amount is calculated pro rata.

How do you apply for the 30% ruling?

Employer and employee submit the application jointly to the Tax Administration. Practical assesses the situation, collects the necessary information, and prepares the application. After receiving a valid granting decision, we process the ruling in the payroll administration and monitor the alignment with payroll taxes and the tax return.

What happens when an employee changes employers?

When moving within the same coherent group of withholding agents, the existing granting decision can remain valid, provided the employee continues to meet the conditions. When moving to another employer, a new application is usually required. The new employment must start within three months; for application from the first working day, the application must be submitted within four months of the start.

Can Practical support a foreign employer without a Dutch branch?

Yes. Practical supports international employers with employees in the Netherlands. Depending on the situation, we help with Dutch registration, payroll administration, payroll tax returns, and application of the 30% ruling. This allows employers without a Dutch branch to properly organize their Dutch payroll obligations.

Does Practical also handle US tax returns?

Yes. Practical also handles the US tax return for US citizens and Green Card holders. Where relevant, we align this with the Dutch income tax return and the 30% ruling. The exact filing obligation and activities depend on the personal situation.

What will change from 2027?

Based on current legislation, the maximum percentage will decrease from 30% to 27% starting in 2027, and a higher salary standard will apply. Transitional law may apply to employees who already applied the ruling in 2023. Have an assessment carried out before 2027 to determine which rules apply to the relevant granting decision and payroll situation.

Your 30% query assessed in context

Whether it concerns an initial application, payroll processing, a change of employer, or alignment with your Dutch or US tax return: Practical views the components in context.

Financial Controller

Eva de Jong

One line between application, payroll, and tax return.

The 30% ruling does not stand alone. The assessment, application, granting decision, payroll administration, and tax return must correctly align with each other.

Practical brings these components together. Even in the case of an extension, change of employer, or US tax return, our specialist team monitors the financial, fiscal, and administrative coherence.

Discuss your expat question

Would you like to know if the 30% ruling applies, do you need support with an application, or help with processing in your payroll administration? Tell us briefly about your situation. We will ensure that your question goes directly to the right specialist.

Dutch tax return and US tax return

Dutch income tax and coordination with specialized US advisors regarding federal and state tax returns.

30% ruling and payroll administration

Correct processing of the granting decision in the payslip and payroll tax return, with attention to the salary standard, duration, and changes.

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