Taxation of international executives
Are there social security/social insurance taxes in the Netherlands? If so, what are the rates for employers and employees?
The Dutch social security system consists of the National Insurance, the Employee Insurance and the Medical Insurance.
|Type of insurance||Paid by employer||Paid by employee||Total|
|Unemployment Insurance Act||2.94 or 7.94% (depending on the duration of the contract)||0.00%||2.94 or 7.94% (depending on the duration of the contract)|
|General Old Age Pensions Act||0.00%||17.90%||17.90%|
|General Surviving Relatives Act||0.00%||0.10%||0.10%|
|Long-term Care act||0.00%||9.65%||9.65%|
|Health Insurance Act||6.70%||0.00%||6.70%|
|Total||18.19 or 23.19%||27.65%||45.84 or 50.84%|
The National Insurance is comprised of the following contributions:
The Employee Insurance is comprised of the following contributions:
Depending on the employee’s profession and duration of the employment contract, different rates may apply when calculating Employee Insurance contributions. The above percentages are average percentages for the Employee insurances.
Per 1 January 2006, the Health Insurance Act is applicable. The insurance premium consists of a nominal contribution (on average EUR1,415 per year, to be paid by the employee) and a means-tested contribution. The means-tested employer contribution is 6.70 percent of the income for contribution purposes (capped at EUR57,232, that is, EUR3,834.54 per year) and is an employer’s contribution.
Calculation of social security liability for the employee in sample calculation above
|National insurance (levied together with income tax, before deduction of tax rebates)||9,597|
Are there any gift, wealth, estate, and/or inheritance taxes in the Netherlands?
Gifts made by a resident of the Netherlands are basically taxed at the same rates as net assets inherited from the estate of a resident, although the tax-free limits may differ depending on the recipient of the gift. In certain situations gifts made by former residents of the Netherlands are also taxed. Resident persons who benefit from the 30 percent ruling are subject to the tax like any other taxpayer.
There is no wealth tax in the Netherlands. However, wealth is taxed in Box 3 of the Dutch income tax.
Inheritance tax is levied on the net assets inherited from a person who is a resident of the Netherlands (this includes persons who benefit from the 30 percent ruling) or who died as a Dutch citizen within 10 years of leaving the Netherlands. The inheritance tax imposes less of a burden on close family members compared with that imposed on distant relatives or unrelated persons.
Are there real estate taxes in the Netherlands?
Real estate tax is assessed by the municipality on the occupier of real property and is based on the value of the property. The rates vary from town to town.
Are there sales and/or value-added taxes in the Netherlands?
There is a sales tax on the transfer of Dutch real estate (this real estate transfer tax is 6 percent for commercial real estate and 2 percent for residential property).
The normal VAT rate is 21 percent. For certain goods and services other rates apply (9 percent or 0 percent).
Are there additional taxes in the Netherlands that may be relevant to the general assignee? For example, customs tax, excise tax, stamp tax,and so on.
There are several local taxes assessed by the municipality, for instance waste tax, sewage charges, and dog tax.
Is there a requirement to declare/report offshore assets (e.g., foreign financial accounts, securities) to the country/jurisdiction’s fiscal or banking authorities?
All information contained in this publication is summarized by Meijburg & Co Tax Lawyers, the Netherlands member firm affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity, based on the Dutch Personal Income Tax Act 2001 and the Dutch Wage Tax Act 1964. These laws can be found at https://wetten.overheid.nl
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