Calculate Dutch income tax across Box 1 (36.97%/49.50%), Box 2 (24.5%/33%) and Box 3 (deemed return). Includes general tax credit, labour credit, and 30% ruling for expats. EUR.
Netherlands Income Tax 2026
The Dutch tax system uses three "boxes" with different rates. Box 1 covers employment income at progressive rates. Box 2 covers substantial business interests. Box 3 taxes deemed returns on wealth. Two main tax credits reduce your Box 1 liability.
Box 1 Calculation
30% Ruling: Taxable income = 70% of gross salary (if qualifying expat)
Box 1 Tax = 36.97% × min(income, €38,441) + 49.50% × max(0, income − €38,441)
General Tax Credit: up to €3,362 (phases out above €24,813, zero at €75,518)
Labour Tax Credit: up to €5,553 (phases out above €43,070, zero at €124,935)
Net Box 1 Tax = Box 1 Tax − General Credit − Labour Credit
Example: €70,000 salary, no 30% ruling
Box 1 tax: €38,441 × 36.97% + €31,559 × 49.50% = €14,217 + €15,622 = €29,839
General credit: ~€0 (phases out at €70K income)
Labour credit: ~€0 (phases out at €70K income)
Net Box 1 tax: ~€29,839 | Effective rate: 42.6%
With 30% ruling: taxable €49,000 → tax ~€18,845 | Effective rate: 26.9%
Frequently Asked Questions
What are the Netherlands Box 1 income tax rates for 2026?
Box 1 (employment income, self-employment, home ownership) uses two rates: 36.97% on income up to €38,441 and 49.50% on income above €38,441. This includes social insurance contributions for the lower bracket. Box 2 (substantial interest in company) applies 24.5% on dividends/gains up to €67,000 and 33% above. Box 3 (savings and investments) uses a deemed return system based on asset composition.
What is the Netherlands 30% ruling?
The 30% ruling (known as the "30%-regeling") allows qualifying expats recruited from abroad to receive 30% of their gross salary tax-free. To qualify, you must have specific expertise not readily available in the Netherlands, have lived more than 150km from the Dutch border for 16 of the 24 months before employment, and earn at least €46,107 (2026 threshold, €35,048 for under-30 with master's degree). The ruling applies for up to 5 years and is capped — since 2024 the benefit is capped at the "Balkenende norm" (€233,000 salary).
What is the algemene heffingskorting (general tax credit) in the Netherlands?
The general tax credit (algemene heffingskorting) is a direct reduction from your income tax. For 2026, the maximum credit is €3,362 for incomes below €24,813. The credit phases out at higher incomes, reaching €0 at approximately €75,518. There is also a labour tax credit (arbeidskorting) for employees of up to €5,553, which also phases out at higher incomes. These credits make the effective Dutch tax rate lower than the nominal rates suggest for most workers.
How does Box 3 (savings and investments) work in the Netherlands?
Box 3 taxes a "deemed return" on net assets above the exemption threshold (€57,000 single / €114,000 fiscal partners in 2026). Rather than taxing actual returns, the Dutch tax authority calculates a theoretical return based on asset composition: bank savings earn a lower deemed return (~1.44%), while investments and other assets earn a higher deemed return (~6.04%). The flat Box 3 tax rate is 36%. Note: Box 3 has been subject to legal challenges and may be reformed.
Are Dutch taxes high compared to other EU countries?
The Netherlands has one of the higher marginal rates in the EU at 49.50% (above €38,441 in Box 1). However, the 30% ruling for expats effectively reduces this to about 34.65% on 70% of income. The generous tax credits (general + labour) reduce effective rates significantly for average earners. The Netherlands ranks roughly middle-to-upper in EU tax burden, with generous public services and infrastructure in return. For expats with the 30% ruling, the Netherlands can be tax-competitive.