How emigrating from the Netherlands influences your tax position

Emigrating can have significant consequences for your tax position. Once you leave the Netherlands, your tax position may change drastically. This means that you are no longer taxable in the Netherlands, but you may be taxable in your new country of residence. It is important to understand what taxes you still owe and what obligations you have before you leave.

In addition, transitional arrangements may apply depending on your personal situation. For example, if you still generate taxable income in the Netherlands, such as owning a Dutch property or receiving dividends, you may still need to pay tax on this.

Fiscal residency

Fiscal residency determines in which country you are taxable. When you emigrate, your residency generally changes to your new country of residence. This means you pay taxes in that country on your worldwide income. The Netherlands has specific rules to determine when you are no longer considered a tax resident.

To officially change your residency, you must deregister from the Dutch municipality and register in your new country of residence. This process can take some time, so be sure to arrange this well in advance.

It is also important that during your stay abroad, you keep the Dutch tax authorities informed of any address changes.

Tax advantages and disadvantages 

There are both advantages and disadvantages to emigrating from a tax perspective. One possible advantage is that you will end up in a country with a more favorable tax rate, which may increase your net income. Another advantage may be that you will receive a tax refund for the year you leave because too much tax was withheld on your employment income in the Netherlands.

On the other hand, there may be disadvantages, such as the loss of certain deductions or tax credits you had in the Netherlands. In some situations and for certain types of income you can continue to be taxable in the Netherlands for several years.

There may also be obligations in your new country of residence that you are not yet familiar with, such as local taxes and social security contributions. It is therefore important to inform yourself well about the tax structure in your new country.

Practical tips 

Start preparing for your emigration on time so that you are not confronted with any surprises. Collect all necessary documents and make sure you deregister from the Dutch municipality.

Consult a tax advisor to get a clear picture of your new tax obligations and options. Make sure you complete all relevant tax forms correctly and on time, both in the Netherlands and in your new country of residence.

If you are emigrating, you will receive an invitation from the Dutch tax authorities to complete an M-tax form (migration tax return) after the end of the year. It is important that you fill this in correctly.

Questions?

Would you like to know what the tax consequences are in your specific situation: please contact us or book a no-obligation consultation with one of our experts and stay informed!