1. What Is the 30% Ruling?

The Dutch Expat Scheme, commonly known as the 30% ruling, is a tax facility for certain employees who are recruited from abroad or transferred to the Netherlands.

When the conditions are met, an employer can provide a tax-free reimbursement for qualifying extraterritorial costs. Instead of proving those costs individually, the employer can use the tax-free percentage method, subject to the applicable rules and maximum.

The ruling is a tax facility. It is separate from immigration schemes such as the highly skilled migrant residence permit.

Source: Business.gov.nl – The expat scheme (30% ruling).

2. What Changes in 2027?

Under the current government proposal, the maximum tax-free reimbursement will be reduced from 30% to 27% from 1 January 2027.

Business.gov.nl currently lists €50,436 as the proposed 2027 income standard and €38,388 for qualifying employees under 30 with a master’s degree. The 2027 amounts are subject to annual indexation.

Important: The 2027 change is not yet final law. The official Business.gov.nl page says the effective date is expected to be 1 January 2027 but remains subject to parliamentary approval and publication.

Sources: Business.gov.nl – 30% ruling compensation down to 27%; Rijksoverheid – Expatregeling.

3. Transitional Rules: Who Gets 30% and Who Gets 27%?

The transition depends on when the employee started using the 30% ruling. Rijksoverheid’s current table states:

So, the headline “30% becomes 27%” does not mean every existing 30% ruling holder will immediately move to 27%. Employees who started using the scheme by 31 December 2023 are covered by the published transitional arrangement that keeps the 30% rate and current salary standard.

Source: Rijksoverheid – Expatregeling and transitional table.

4. Salary Requirements

2026 official salary standards

For the standard specific-expertise route, the employee’s taxable annual salary, excluding the tax-free allowance, must be more than €48,013 in 2026.

For qualifying academic employees who are under 30 and have a Dutch academic master’s degree or an equivalent foreign degree, the 2026 standard is €36,497.

There are exceptions. Employees conducting scientific research at designated research institutions and doctors training to become specialists do not have to meet an income standard.

Proposed 2027 standards

For employees affected by the new 2027 salary standard, Business.gov.nl currently lists:

• €50,436 standard income threshold.
• €38,388 for qualifying employees under 30 with a master’s degree.

The 2027 figures are subject to annual indexation.

Sources: Belastingdienst – Expat Scheme conditions; Business.gov.nl – 2027 change.

5. Other Eligibility Requirements

Meeting the salary requirement by itself does not automatically qualify someone for the ruling. The Tax Administration lists several conditions.

• Employment: you must be in paid employment with your employer.
• Specific expertise: the applicable income standard normally has to be met. In exceptional cases, a scarcity requirement can also apply.
• Recruitment from abroad: you must have been recruited from outside the Netherlands or transferred to the Netherlands.
• 150-kilometre test: during the 24 months before your first working day in the Netherlands, you generally must have lived more than 16 months at more than 150 kilometres as the crow flies from the Dutch border.
• Official decision: the employer and employee apply to the Tax Administration and receive a beschikking if the request is approved.

The Tax Administration specifically notes that the 150-kilometre condition excludes people who lived in Belgium, Luxembourg and parts of Germany, France or the United Kingdom during the relevant period.

Source: Belastingdienst – Can I apply for the Expat Scheme?.

6. How the 30% / 27% Calculation Actually Works

This is an important detail that is often simplified incorrectly online.

The Dutch Tax Administration explains that the maximum tax-free reimbursement can be calculated as a percentage of the employee’s salary including the reimbursement. Under the current 30% rule, that means the maximum is 30% of the total salary including the reimbursement.

Alternatively, the employer may calculate the maximum as 30/70 of the salary excluding the reimbursement. The applicable salary requirements still have to be met.

For example, if the salary including the tax-free reimbursement is €70,000, the maximum 30% reimbursement under the current rule would be €21,000.

This is why a simple statement such as “€100,000 gross salary means exactly €30,000 tax-free” can be misleading unless it is clear whether €100,000 is the salary including or excluding the reimbursement.

For 2027, the proposed maximum would be 27%. The exact payroll calculation should therefore be based on the final legislation and the Tax Administration’s applicable guidance at that time.

Source: Belastingdienst – Inhoud van de expatregeling.

7. Actual Extraterritorial Costs

The percentage method is not the only option. An employer can choose to reimburse actual extraterritorial costs tax-free instead.

Business.gov.nl says the employer can choose between reimbursing actual qualifying costs and applying the tax-free percentage. If actual costs are reimbursed, they must be reasonable and plausible and should be recorded in the payroll administration.

The employer must make the relevant choice during the first payroll period of each year and repeat the choice for subsequent years during the 5-year period.

Source: Business.gov.nl – Actual costs versus the tax-free percentage.

8. Partial Foreign Tax Liability

This is a separate change from the proposed 2027 reduction.

Since 1 January 2025, employees using the expat scheme can no longer opt for the so-called partial foreign tax liability in their Dutch income tax return.

Under a transitional arrangement, employees who were awarded the expat scheme in the last payroll period of 2023 can continue using partial foreign tax liability until the end of 2026.

This means newer expat-scheme users should not assume that the former Box 2 and Box 3 treatment is still available to them.

Source: Business.gov.nl – Termination of partial foreign tax liability.

9. Maximum Salary Amount

The expat scheme is also subject to a maximum salary amount for the tax-free reimbursement.

Rijksoverheid states that, from 1 January 2026, the maximum remuneration limit based on the Dutch Standards for Remuneration Act (WNT) is €262,000 per year for the expat scheme.

There is a separate transitional rule for certain employees who started using the scheme before 1 January 2023. The applicable maximum can therefore depend on when the employee began using the scheme.

Sources: Rijksoverheid – Expatregeling; Business.gov.nl – Expat Scheme.

10. Application and Duration

The employee does not simply activate the 30% ruling through an annual tax return. The employer and employee apply together to the Dutch Tax Administration.

If approved, the Tax Administration issues a formal decision (beschikking). The maximum duration is generally 5 years, although previous periods of work or residence in the Netherlands can reduce the remaining period.

If an employee changes employer during the ruling period, the scheme can continue under certain conditions. The new employer and employee must submit a new request.

Sources: Belastingdienst – Applying for the Expat Scheme; Belastingdienst – Decision validity and conditions.

11. Frequently Asked Questions

Is the 30% ruling definitely becoming 27% in 2027?

The government currently expects the maximum to fall to 27% from 1 January 2027. However, the effective date is not yet final and remains subject to parliamentary approval and publication.

Will every existing 30% ruling holder drop to 27%?

No. The published transitional arrangement keeps the 30% rate for employees who started using the ruling no later than 31 December 2023. Employees who started in 2024 move to 27% from 2027 but keep the current salary standard, while employees who started from 1 January 2025 move to 27% and the new salary standard.

Are the €50,436 and €38,388 figures final?

They are the figures currently published for the proposed 2027 change by Business.gov.nl. The 2027 measure itself is not yet final law, and the amounts are subject to annual indexation.

Does the 27% mean I automatically receive 27% of my gross salary tax-free?

No. It is a maximum reimbursement under the scheme. The calculation depends on the salary definition used for the reimbursement, and the employer is not required to use the maximum.

Can I qualify if I already live in the Netherlands?

The normal scheme requires recruitment from abroad or a qualifying transfer and includes the 150-kilometre residence test. Your exact work and residence history matters.

Does the 30% ruling give me a residence permit?

No. It is a tax facility. Residence permits such as the highly skilled migrant permit are separate immigration arrangements.

How long can the ruling last?

The maximum duration is generally 5 years, subject to reductions for certain previous periods of work or residence in the Netherlands.

Can I still use partial foreign tax liability?

Generally, no from 2025 onward. Certain employees who were awarded the expat scheme in the last payroll period of 2023 can use the transitional arrangement until the end of 2026.

12. Sources

• Rijksoverheid – Expatregeling hoogopgeleide buitenlandse werknemers
• Business.gov.nl / RVO – 30% ruling: compensation for expats down to 27%
• Business.gov.nl – The expat scheme (30% ruling) in the Netherlands
• Belastingdienst – Can I apply for the Expat Scheme?
• Belastingdienst – Contents and calculation of the Expat Scheme

Editorial note: This article was reviewed against official Dutch government sources on September 16, 2026. The 2027 reduction to 27% and the new salary standards are described as proposed changes because the effective date is not yet final.

13. The Dutch Corner 🇳🇱