How to file your Dutch taxes if you earn 90% or more of your income in The Netherlands while living abroad

In 2015 a new article was introduced in the Dutch income tax law. The article concerns taxpayers who live-, and pay taxes abroad whereas most of their income is taxable in the Netherlands. For example German citizens who work in The Netherlands but live in Germany. The taxpayers can opt for the same deductions and tax credits as the resident tax-payers of the Netherlands.

This regulation is meant for foreign tax payers who live in an EU country, Norway, Iceland, Switzerland, Lichtenstein, Bonaire, Sint Eustacius or Saba. At least 90% or more of the earned income must be taxed with Dutch income tax. In order to prove this, the eligible foreign tax payers have to file a Personal Income Statement together with their Dutch income tax return with the Dutch tax authorities. Their Income statement must be signed by the tax authorities of their country of residence. With this statement they are able to prove their earned and taxed income in the country of residence.

When the person qualifies as an eligible foreign tax payer in The Netherlands, then they have the right to apply for tax credits, personal deductions and tax free-allowances in their Dutch income tax return. Think about the deductibility of interest paid on the mortgage for house owners, or the possibility to deduct health costs which are not reimbursed by the health insurance. To avoid the so called “double dipping”, it’s not possible to apply for several deductions or allowances when they are already applied in the income tax return of the country of resident. In case the possibility to apply for these deductibles exists in the country of residence, then this has to be applied in the income tax return of this country. The applicant can’t choose between deductibles.

If the applicant has a partner it’s possible for them both to apply for this regulation, therefore 90% of their income has to be taxed with Dutch income tax. So in some cases the partners have to file different tax returns or only one partner can file the income tax return in The Netherlands and the other one can’t. Following the above points, you to can apply this to your personal situation if applicable. You can very well arrange this independently. If you prefer some professional assistance and assurance, Taxtics is at your service.


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