Changes in 30% facility now final

Further to the House of Representatives passing the Tax Plan 2025, the Senate did the same on 17 December 2024. This made the changes in the 30% facility final and the amended legislation has since entered into force on 1 January 2025. 

Given the large number of changes in recent years, we have set out for you here the current situation and the other changes still to come.

30% facility in 2025

Personnel to whom the 30% facility has been granted can, at present, receive a tax-free allowance from their employer of up to 30% of their gross salary taxable in the Netherlands provided that the conditions of the scheme are met.

One of the conditions to be eligible for the 30% facility is that the salary criterion must be met. This is a continuous assessment which means that this criterion must always be met throughout the duration of the 30% facility. The salary criterion sets the minimum amount that the employee should receive as taxed salary, i.e. after the 30% facility has been applied. In 2025 this is €46,660. A lower salary of €35,468 applies in 2025 to employees under the age of 30 who have obtained a Dutch master’s degree or equivalent qualification. 

Salary cap

From 2024 the 30% facility has been capped at what is referred to in Dutch as the "Balkenende-norm" (i.e. the maximum that may be paid to senior executives in in the public and semi-public sectors). In 2025 the 30% facility may be applied to up to €246,000 in salary. If it is more than this then no tax-free allowance can be applied to the excess. 

Taxpayers who applied the 30% facility in the payroll accounting no later than December 2022 are entitled to make use of the transition arrangements. As a result the salary cap will only apply to these people from 2026.

Partial foreign tax liability

Up until the end of 2024 taxpayers who were eligible for the 30% facility could elect to be treated as a foreign taxpayer for Box 2 (income from a substantial interest) and Box 3 (income from savings and investments) for the duration of the 30% facility. This means that, in principle, no Dutch tax had to be paid on income received from outside the Netherlands. This is known as the "partial foreign tax liability". Opting for this partial foreign tax liability has been abolished from 1 January 2025.

There are transition arrangements in place if the 30% facility was applied in the payroll accounting before December 2023 on the basis of a granted 30% facility. Under the transition arrangements the partial foreign tax liability can still be claimed in 2025 and 2026. From 1 January 2027, however, this option will no longer be available.

27% facility from 2027

From 2027 the 30% facility will become a 27% facility in which the maximum tax-free allowance will thus be reduced by three percent and higher salary standards will apply. These salary levels have been set at €50,436 for a regular employee and €38,338 for taxpayers under the age of 30 holding a master’s degree. However, these amounts will be annually indexed, even before the new percentage comes into force in 2027.

Transition arrangements will apply to people who already made use of the 30% facility before 1 January 2024. They will retain their entitlement to the full 30% allowance provided that the current income standards (subject to indexation) are met. The employer can pay up to 30% of these employees’ salary tax free for a period of no more than five years.

Employees who applied the 30% facility for the first time in 2024 will be subject to the reduced 27% facility from 1 January 2027. However the current (lower) salary criteria will continue to apply to these people.

The table below provides an overview of the various changes and transition arrangements, depending on the calendar year in which the 30% facility was first applied in the payroll accounting:

First application of the 30% facility

Salary cap applies from

Partial foreign tax liability abolished from

Maximum allowance reduced to 27% from

Higher salary criterion applies from

2022

2026

2027

N/A

N/A

2023

2024

2027

N/A

N/A

2024

2024

2025

2027

N/A

2025

2025

2025

2027

2027