The shortening of expatruling concerns employers and employees. But what is the impact on your specigic situation for the organization and the employees?
In the online edition of the FD (may 1st, 2018) an opinion article is published.
On 20th of april, the cabinet announced to reduce the 30% ruling for five years. This article contains an opinion of two PwC-experts in the field of cross-border employment, about the announced consequences for workers who already have the 30% ruling.
The tightening of these so-called ' expatriate ruling ' also applies to existing cases, without transitional law, and can for existing situations be very profound. From the point of view of legal certainty we therefore argue that there is still a form of transitional law need to be introduced.
The shortening of the 30% ruling came as no surprise, but was a recommendation that followed from an evaluation which mid last year has been executed. The lack of transitional law means, for example, that an employee who uses the 30% ruling for the period from January 1st, 2014 until January 1st, 2022 comes 7 months short. This interim shortening caused concern among employers and expatriates.
Transitional law workers who already make use of the 30%-ruling?
We consider it undesirable for several reasons that there is no transitional law that will apply to workers already make use of the 30% ruling. So it is to be expected that employers will be faced with legal procedures with employees. Some employees will believe that the employer must compensate, for example, from that side expectations caused a certain net income for a period of eight years.
The predictability of the financial impact of tax legislation, we consider of great importance. This element therefore deserves more attention in the legislative process. Although, of course, in a general sense, tax law changes frequently, is in this case to situations in which for some time has been declared a arrangements and decisions have been issued. Career and investment decisions are made on the basis of such concrete expectations ...
... We advocate the introduction of transitional law. From our point of view, this can be easily shaped by, in short, the duration of the 30%-arrangements be entered before 20 april 2018 (date on which the changes are announced) unchanged.
Read more? Visit FD.nl. Of course we offer advise and support by indicating the consequences of the change of the 30% ruling in your specific situation. Please contact our tax adviser Jantiene van der Velden and she will help you.