The 30% ruling : changes in 2024

Jan 8, 2024

On October 26th, 2023, at the very last moment, the Dutch House of Representatives managed to squeeze through a number of very important changes for expats. These changes will be included in the Tax Plan 2024, which have been approved by the Dutch Senate in December 2023. The 30% ruling will undergo a metamorphosis, after which it will in effect become a 20% ruling (over the course of 5 years, that is). In addition to this, the rules regarding the partial non-resident tax status will change. In this article we will fill you in on what you need to know.

What does the 30% ruling do again?

The 30% ruling is a high-impact expat tax break that is meant to help Dutch companies attract foreign talent. If the employee meets the 30% requirements, the 30% ruling allows the employer to pay 30% of the annual salary to the employee as a tax free compensation for extraterritorial costs. Bear in mind that the 30% ruling only applies to the remaining amount of the salary after the minimum gets subtracted. At all times, normal and full employment taxes must be paid over at least the minimum amount (€ 46,107 or € 35,048 if you are under 30 years old and have a Master’s Degree (2024)). This means that in order to have a full 30% tax free compensation in 2024, an employee must earn € 65,867 per year (that is: € 46,107 divided by 0,7).

In addition to the cost-free compensation, the 30% ruling holder has a number of other benefits:

  1. Partial non-resident tax status for box 2 and box 3, for both the holder and their partner. This means that any foreign savings, stocks, crypto, real estate and other assets are kept out of the Dutch income tax returns;

  2. The ability to compensate the employee tax-free for expat schooling costs for their child(ren);

  3. Free swap of foreign driver’s license to a Dutch driver’s license, for both the holder and their partner.

In 2024 the tax-free compensation rules (i.e. the 30% part of the ruling) will be as follows:

  1. 30% during the first 20 months of the employment;

  2. 20% during month 21-40 of the employment;

  3. 10% during the final 20 months of employment

If an employee obtains a 30% ruling for less than 60 months (for example due to time previously spent in the Netherlands), these months are subtracted from the 10% months first, working back up to the 30% months.

The transition between 2023 and 2024

The adopted amendment provides for a transitional arrangement : as long as the expat receives a salary in 2023 with the 30% ruling applied to it, the old regime will apply. That means full 30% tax break for five years. Incoming expat employees at around the year-end break are therefore well advised to explore the possibility of a December 2023 start. Returning expat employees who applied the 30% ruling in 2023 or earlier and then left the Netherlands, and subsequently returned in 2024 as an incoming expat employee, will fall under the new regime. The transitional arrangement will not apply to them. A 30% ruling holder from before 2024 who switches employment in 2024, will remain under the old regime according to current rules (November 2023).

Previous scale-back

The year 2023 already brought us a scale-back of the 30% ruling, though not of the same magnitude. 30% ruling holders starting in 2023 will as of January 1st, 2024 have their 30% compensation capped to the Dutch public sector pay cap (the so-called “Balkenendenorm”), which will stand at € 233,000 in 2024. That means the tax-free compensation in 2024 can be a maximum of € 69,900 (0.3 x € 233,000). Any salary above the cap will be taxed fully and normally, without application of the 30% ruling. A transitional arrangement applies: 30% ruling holders that started before January 1st, 2023 will have their 30% ruling capped to the Balkenendenorm as of January 1st, 2026 only.

The non-resident tax status

Then there’s the other expat tax break that is normally conferred as part of the 30% ruling : the partial non-resident tax status. This status gives the 30% ruling holder and their tax partner the opportunity to opt out of box 2 and box 3 taxation of foreign assets. That means that overseas savings, stocks, crypto, real estate and other assets are kept out of the Dutch income tax returns. The partial non-resident tax status has been flagged as “abuse prone”, so this one was to be expected. 30% ruling holders starting in 2024 will have their partial non-resident tax status revoked as of 2025 and further. A separate transitional arrangement applies here as well : 30% holders from before January 1st, 2024 will have their partial non-resident tax status revoked only as of 2027 and further. So 2026 is the last year of partial non-resident tax status for everybody.

An example

Sally is an incoming expat employee in Amsterdam in December 2023, and her employer is applying for the 30% ruling for her. She is not able to obtain a BSN number before January 2024, but she’s getting to work immediately in December 2023. She will therefore enjoy a salary for that month. The actual salary payment for December 2023 is made in January 2024. She only expects to receive the final verdict on her 30% ruling in March 2024. What rules will apply to Sally?

For the application of the transitional arrangement between the two regimes, the salary period decides the cut-off date here. Not the actual payment date of the salary or the date on which the 30% ruling was issued. A 30% ruling always works back retroactively to the start date, so it can be applied immediately to the first salary without needing to have the actual 30% ruling in hand. In the odd case the 30% ruling is denied, the salary simply gets recalculated without application of the 30% ruling and taxes are paid back.

In Sally’s case, the 30% ruling would work retroactively to December 2023. Hence, the salary received over that period would fall under the transitional arrangement. The fact that the actual payment is done in January 2024 is irrelevant here. Therefore Sally would fall under the old 30% regime (30% tax free compensation for 5 years) and a partial non-resident tax status until 2026. Sally’s application of the 30% ruling would be capped at € 233,000 in 2024 due to the previously rolled out scale-back.


We do not serve regular employees with single 30% ruling applications. Regular employees are kindly requested to contact their (prospective) employers with further questions. Within the context of the 30% ruling, Cardon & Company’s work focuses exclusively on business owners .