How long does the Dutch 30% ruling last and what happens when it ends?

mei 27, 2026

The 30% ruling in the Netherlands is a tax facility for highly skilled migrants that allows a portion of their salary to be paid tax-free. It does not last indefinitely. Since 2024, the ruling applies for a maximum of five years, and when it ends, the employee’s full salary becomes subject to Dutch income tax. Here is what that means in practice for both the employee and the employer.

What is the 30% ruling and who qualifies for it?

The 30% ruling is a Dutch tax facility that allows qualifying international employees to receive up to 30% of their gross salary as a tax-free reimbursement for extraterritorial costs. It is designed to attract skilled workers from abroad and reduce the financial burden of relocating to the Netherlands.

To qualify, an employee must be recruited from outside the Netherlands, have specific expertise that is scarce in the Dutch labour market, and meet a minimum salary threshold. The salary requirement is adjusted periodically, and there is a lower threshold for employees under 30 with a master’s degree. The ruling must be applied for jointly by the employer and employee through the Dutch Tax Authority (Belastingdienst), and it applies only when there is a formal Dutch employment relationship in place.

For foreign companies employing staff in the Netherlands, the ruling can be a meaningful tool for attracting international talent. However, it comes with an expiry date, and planning around that date matters more than many employers realise.

How long does the 30% ruling last in the Netherlands?

The 30% ruling currently lasts for a maximum of five years. This five-year period runs from the start date of Dutch employment, and the clock starts ticking on the first day the ruling takes effect, not on the date the application is approved.

The five-year term applies to rulings granted from 2024 onwards. During this period, the employer can apply the 30% tax-free reimbursement to the qualifying portion of the employee’s salary each payroll cycle. Once the five-year period is reached, the ruling expires automatically. There is no automatic renewal and no grace period.

It is worth noting that any previous periods of residence or employment in the Netherlands can reduce the available duration. If an employee lived in the Netherlands within the 25 years prior to their current employment, part of that period may be deducted from the five years. This makes it important to assess the full employment and residency history of each qualifying employee before submitting an application.

Has the duration of the 30% ruling changed recently?

Yes, the duration of the 30% ruling has changed significantly in recent years. Before 2019, the ruling lasted for eight years. From 2019, this was reduced to five years. A further change introduced in 2024 replaced what had briefly been a scaled-down approach with a flat five-year cap, removing the phased reduction that had been introduced in 2023.

The phased approach that was in effect during 2023 introduced a tiered system in which the 30% rate applied only for the first 20 months, followed by 20 months at 20%, and a final 20 months at 10%. This created uncertainty for both employees and payroll administrators. The Dutch government reversed this model and returned to a flat 30% rate for the full five-year period, which took effect in 2024.

Employees who were already benefiting from the ruling before these changes may be subject to transitional rules. If your organisation employs staff who obtained the ruling before 2019 or during the transitional period, it is worth verifying exactly which rules apply to each individual, as the effective duration and rates can differ depending on when the ruling was originally granted.

What happens to your salary when the 30% ruling ends?

When the 30% ruling ends, the full gross salary becomes subject to Dutch wage tax and social security contributions. The tax-free reimbursement disappears entirely, which means the employee’s net take-home pay drops, often noticeably, without any change to the gross salary agreed in the employment contract.

The practical impact depends on the employee’s salary level and personal circumstances, but the shift can be substantial. Dutch income tax rates are progressive, and for higher earners, a significant portion of income falls into the top bracket. The loss of the 30% facility means that portion is now fully taxed, which can result in a meaningful reduction in net pay.

From an employer perspective, this change can affect talent retention. Employees who structured their financial lives around the net salary they received under the ruling may find their post-ruling income less attractive. Some employees choose to renegotiate their gross salary at this point, which increases the employer’s payroll costs. Others may consider leaving the Netherlands altogether. Neither outcome is ideal, which is why proactive planning well before the ruling expires is worth the effort.

Can the 30% ruling be extended or renewed after it expires?

No, the 30% ruling cannot be extended or renewed once it has expired. The five-year maximum is a hard limit under Dutch tax law. Once the ruling ends, the employee cannot reapply for the same position, and the employer cannot continue applying the tax-free reimbursement.

There is one scenario in which a new ruling may be possible: if the employee leaves the Netherlands, works abroad for a period, and is then recruited back to the Netherlands for a new position. In that case, a fresh application may be submitted, but the previous time spent in the Netherlands will again be assessed and deducted from the available duration. The 25-year lookback rule applies here as well.

It is also worth being clear that changing employers within the Netherlands does not reset the clock. The five-year period follows the employee, not the employment contract. If an employee switches to a new Dutch employer, the ruling can be transferred, but the remaining duration carries over. A new employer cannot grant a fresh five-year period to an employee whose ruling is already two or three years in.

What other benefits are lost when the 30% ruling ends?

Beyond the salary impact, the end of the 30% ruling also removes access to two other connected benefits: the option to be treated as a partial non-resident taxpayer for Dutch income tax purposes, and the ability to exchange a foreign driving licence for a Dutch one without taking a full driving test.

Partial non-resident taxpayer status is the more financially significant of the two. While the 30% ruling is active, employees can opt to be treated as non-residents for Box 2 and Box 3 income tax purposes. This means that certain foreign savings, investments, and shareholdings may fall outside the scope of Dutch taxation. Once the ruling ends, this option disappears. The employee becomes a full Dutch tax resident for all income categories, which can increase their overall tax exposure if they hold assets abroad.

For employees with substantial foreign investments or shareholdings, this transition can have real consequences. It is worth reviewing the employee’s personal tax position before the ruling expires, ideally with a tax adviser who understands both Dutch personal income tax and the employee’s home-country tax obligations.

How should employers and employees prepare for the end of the 30% ruling?

Preparation should start at least six to twelve months before the ruling expires. Both the employer’s payroll team and the employee need to understand the financial impact and make informed decisions before the change takes effect, not after the first payslip without the ruling arrives.

For employers, the key steps are:

Audit your payroll records to identify which employees have a 30% ruling and when each ruling expires.
Model the net pay impact for each affected employee so you understand the cost of any salary adjustment they may request.
Review employment contracts to check whether gross or net salary guarantees are in place, as these affect your obligations.
Communicate early with affected employees so they can plan their personal finances and make informed decisions about their future in the Netherlands.

For employees, the priorities are different but equally straightforward:

Check your ruling’s exact end date with your employer’s payroll team or HR department.
Understand your Box 3 exposure if you hold foreign assets or investments that were previously outside Dutch taxation under partial non-residency.
Review your mortgage, pension, and savings arrangements in light of the change in net income.
Discuss any salary renegotiation with your employer well in advance, rather than as an emergency conversation after the ruling has already ended.

The 30% ruling is a valuable facility while it lasts, but it was never designed to be permanent. Treating its expiry as a known event that requires active planning, rather than an unexpected change, is the most practical approach for both parties.

Managing the 30% ruling, from the initial application through to its expiry and the payroll adjustments that follow, sits at the intersection of Dutch tax compliance and HR administration. It requires accurate record-keeping, timely action, and a clear understanding of how Dutch payroll rules apply to internationally employed staff. If your organisation is navigating this process, whether for a single employee or a larger group, our tax compliance and payroll services are designed to support exactly this kind of ongoing Dutch compliance work. Get in touch with us to discuss your situation and find out how we can help you manage the transition smoothly.