The Dutch Expat Scheme: what you should to know for 2026 and beyond
The expat scheme (formerly known as the 30% ruling) remains one of the most discussed topics in international employment in the Netherlands.
Bottomline, it’s a valuable tax benefit that allows employers to offer up to 30% of an employee’s salary tax-free with a maximum of five years. This allowance is meant to cover additional costs incurred by employees who relocate to the Netherlands from abroad.
Why is the Expat Scheme so important?
In today’s global talent market, the Netherlands faces fierce competition from neighbouring countries like Germany, Belgium, and the Nordics, offering attractive tax incentives for international talent, creating a incentive for them choosing their specific companies over Dutch companies.
At the same time, the Dutch startup and scale-up ecosystem is in desperate need of (international) talent. These companies often rely on highly skilled professionals in technology, engineering, and life sciences, roles that are increasingly difficult to fill locally due to a persistent talent shortage and lack in local education.
The 30% ruling helps Dutch employers stay competitive by:
Reducing the cost of hiring international talent, making relocation financially viable for both parties.
Improving net salary outcomes for expats, which boosts retention and satisfaction.
Levelling the playing field with international employers who offer similar benefits.
Supporting long-term growth in sectors where innovation and speed are critical.
For startups and scale-ups, where budgets are tight and agility is key, the scheme can be a decisive factor in attracting the right people growing their business and attract more investments.
For who is the Dutch Expat Scheme?
To apply the scheme, several conditions must be met:
Incoming employee: The employee must be recruited or transferred from abroad or already live and work in the Netherlands and currently have this ruling granted.
Salary requirements: The employee must meet the minimum salary threshold, which is updated annually, below you’ll find the expected thresholds for 2026.
>150 km rule: The employee must have lived more than 150 km from the Dutch border for at least 16 of the 24 months before starting work in the Netherlands.
Employment agreement: The scheme must be agreed upon in writing between employer and employee, typically in an addendum to the employment contract.
Salary Thresholds for 2026
Although the Dutch Tax Authorities haven’t officially published the 2026 figures yet, several current projections suggest it will be in line with the following overview.
Category Annual Gross salary 2025 Annual Gross salary 2026 (expected)
> 30 years of age € 46.660 € 48.013 (+2.9% vs. 2025)
< 30 years of age € 35.468 € 36.497 (+2.9% vs. 2025)
Maximized cap € 246.000 €262.000 (+6.5% s.c. Balkenende norm)
What does this practically means?
The salary threshold is one of the most important conditions for applying the expat scheme. When submitting the application, the fixed taxable salary must meet the minimum, good to know this is calculated before applying the 30% allowance.
Once granted, the employee must continue to meet this threshold throughout the entire period. If the taxable salary (after applying the allowance) falls below the minimum in any year, due to example changing the working hours downwards, the scheme will be revoked retroactively to the start of that year and terminated permanently. Important note is that the threshold applies per calendar year and is pro-rated for shorter periods (e.g. immigration/emigration).
Though, for part-time employment, the threshold is not pro-rated.
Application and continuation
Application must be done within 4 months of the employee’s start date to benefit from day one. Late applications take effect from the first day of the month in which the request is submitted.
If an employee changes jobs, the scheme can continue only if the gap between contracts is less than 3 months and the new employer reapplies based on the new labour agreement. A valid 30% ruling decision also allows for easy exchange of a foreign driving license.
For employers
The scheme is not only interesting as they result in a higher net salary for the international employee, it’s also interesting for employers. As the social security costs are calculated including the scheme, resulting in lower employer costs allowing them providing a salary in a more competitive range (startups and scaleups vs. corporates).
Changes in 2027 which will have a larger impact
From 1st of January 2027, the maximum tax-free allowance will be reduced to 27%, that’s the reason the name of the ruling changed into Expat Scheme. The expectations for this specific year is that salary thresholds will increase by approximately 5% vs. the current estimations for 2026.
Category Annual Gross salary 2026 (expected) Annual Gross 2027 (expected)
> 30 years of age € 48.013 (+2.9% vs. 2025) € 50.436 (5,0% vs. 2026)
< 30 years of age € 36.497 (+2.9% vs. 2025) € 38.388 (+5.2% vs. 2026)
As other countries enhance their expat regimes, the Dutch government’s decision to reduce the tax-free percentage to 27% in 2027 will impact the Netherlands' attractiveness. Employers should prepare now to retain and attract talent under the evolving conditions.
At Rehive People we understand how complex the expat scheme can be, especially with annual updates and legislative changes. We support employers and employees through this process: from eligibility checks and compliance reviews to filing applications and liaising with the Dutch Tax Authorities.
Whether you're dealing with a new application, a continuation, or a salary compliance check, we’re here to help you stay compliant and make the most of this valuable benefit.
Get in touch: connect@rehivepeople.com to learn more, we love to share our expertise.