The future of the 30%-ruling 2025–2027 The time is now to act

The 30%-ruling remains one of the Netherlands’ most recognizable expat tax benefits, a valuable incentive for employers and international professionals alike. But the window to benefit fully is narrowing. With salary thresholds rising and the tax-free percentage confirmed to drop from 30% to 27% in 2027, timing and preparation are crucial. Here’s what the ruling entails, why it still matters, and how you can act now to secure the best outcome.

What is the 30%-ruling?

The 30%-ruling allows Dutch employers to pay up to 30% of an employee’s salary tax-free to compensate for extra costs related to working abroad, such as housing, relocation, or living expenses. It simplifies administration and makes the Netherlands an attractive destination for international talent. In our previous blog we provide a more detailed explanation of the ruling.

For employers: a practical, compliant, and competitive tool to recruit global expertise.
For employees: a clear, predictable tax advantage that increases take-home pay and offsets relocation costs.

A ruling that still does what it was designed to do: connect knowledge with opportunity.

Why it was created and why it’s more relevant than ever

The 30%-ruling was introduced in the 1960s to attract skilled professionals and strengthen the Dutch economy through knowledge exchange. Decades later, that purpose remains the same. As global competition for talent intensifies, the Netherlands continues to depend on international expertise in technology, finance, energy, and beyond.

Why the 30%-ruling still matters now

1. Global talent scarcity — In a fiercely competitive Global labour market, the 30%-ruling gives the Netherlands a crucial advantage. It enhances employees’ net income without raising gross salaries, helping Dutch employers remain both fiscally efficient and globally appealing.

2. Rising living costs — With inflation, housing prices, and healthcare costs rising, the 30%-ruling helps offset the additional expenses expats face. It’s a practical solution for both employers and employees.

3. Timing is key — the 30%-ruling has undergone some changes throughout the years; mostly in the form of limiting the benefits: from reducing the run time from 8 years to 5 years, abolition of the partial non-residency status, increased eligibility criteria and capping the benefit to the WNT-norm. From 1 January 2027, the tax-free percentage will decrease from 30% to 27%. This lowered percentage is the reason that the ruling is now officially referred to as the expat ruling instead of the 30%-ruling. Employees hired in 2025 or 2026 can still benefit from the full rate until 2027. At the same time, salary thresholds to be eligible for the ruling are expected to rise significantly in 2027, by approximately 9–10% compared to 2026. This dual shift makes qualification more challenging and underscores the importance of planning ahead.

4. Simple and predictable — Unlike many other international tax regimes, the Dutch system is clear, stable, and efficient. This simplicity is a relief for both employers and employees: one fixed percentage, easy to apply, transparent to manage, and providing financial clarity and consistency for everyone involved.

5. The purpose remains — Just as in the 1960s, the 30%-ruling continues to strengthen the Netherlands’ role as a knowledge hub for global talent.

As 2025 ends, who qualifies in 2026?

The eligibility framework for 2026 remains largely unchanged. An employee qualifies if they:

• Are recruited from abroad or transferred to a Dutch employer,

• Possess specific expertise not readily available in the Netherlands,

• Have lived more than 150 km from the Dutch border for at least 16 of the 24 months prior to employment,

• Meet the minimum taxable salary threshold set annually by the Dutch tax authorities:

• • Regular salary criteria:                      EUR 48,013

  • Low salary criteria:                            EUR 36,497

• Submit the (pro-forma) application within four months after starting with the employment.

The expat-ruling can be granted for a maximum of five years, provided all conditions remain met.

The time is now

The rules are steady, but early preparation ensures a compliance process, especially as changes loom in 2027. Therefore: take action in 2025–2026 to secure eligibility and optimize benefits while current conditions still apply.

The expat-ruling isn’t disappearing, it’s evolving and proactive timing makes all the difference.

Practical recommendations; we are here to help

1. Review all current cases to check duration, salary, and eligibility,

2. Submit new applications early since the four-month window is strict,

3. Plan strategically for 2025–2026 hires so they can still benefit from the full 30% temporarily,

4. Communicate upcoming changes clearly with expats because transparency fosters trust and retention,

5. Work with a specialist (Exterus) to ensure compliance and maximize your opportunities.

Exterus’ perspective

The expat-ruling continues to serve as a cornerstone of international employment in the Netherlands. Despite recent adjustments, its purpose remains unchanged — to attract and retain knowledge and innovation.
At Exterus, we see the expat-ruling not merely as a tax measure but as a bridge between knowledge and opportunity. We help employers and employees apply it effectively, ensuring continuity, compliance, and confidence.

The rules change; our partnership doesn’t.

Get in touch

Curious what these changes mean for your organization or employees?
Our Global Mobility team is ready to assist with (salary) assessments, applications, and strategic planning.