Netherlands: our simulator now applies the two tax credits every employee receives

What changed

This note records a correction of our simulator, not a change in Dutch law. In the Netherlands, the tax on a salary (Box 1) is computed in three combined bands that already carry the national insurance contributions, and is then reduced by tax credits, the heffingskortingen. Two of them go to every employee below state pension age. The general tax credit, the algemene heffingskorting, is 3,115 EUR up to 29,736 EUR of income, then falls by 6.398% of the excess and reaches zero from 78,427 EUR. The employment tax credit, the arbeidskorting, rises with employment income in three steps (8.324% up to 11,965 EUR, then 996 EUR plus 31.009% of the excess up to 25,845 EUR, then 5,300 EUR plus 1.950% of the excess) to reach 5,685 EUR at 45,592 EUR, before falling by 6.510% of the excess and reaching zero from 132,921 EUR. The employer applies both every month in the wage withholding, and the Belastingdienst applies them again in the assessment.

Until 8 November 2026 our simulator applied neither. Its accuracy note said so, and added that their absence overstated the tax shown by several thousand euros on an ordinary salary. That was accurate: for a single person at 90,000 EUR gross, the tax shown exceeded the 2026 tables by 2,794 EUR, and the annual net was understated by the same amount. At 30,000 EUR the gap reached 8,479 EUR, both credits being close to their maximum there. Since 8 November 2026 the simulator reads the two Belastingdienst 2026 schedules and shows each credit on its own line in the tax table of the Netherlands page and of the detailed simulation, in both languages. The France versus Netherlands comparison and the equivalent-salary calculation inherit the correction.

The 30% ruling is covered too. The tax-free allowance it grants is a targeted exemption outside the taxable wage; the employment income on which the arbeidskorting is computed is the wage subject to wage withholding, that is the wage after the allowance, and the aggregate income on which the general credit is computed is the same. An employee at 90,000 EUR under the ruling has a taxable wage of 63,000 EUR: the general credit is 987 EUR, the arbeidskorting 4,552 EUR, and the annual net moves from 67,041 EUR to 72,579 EUR.

Effective date

The 2026 schedules of both credits apply to income received from 1 January 2026. The Belastingdienst publishes them in its online tables for individuals and, for employers, in the figures appendix of the Nieuwsbrief Loonheffingen 2026, whose third edition of 3 March 2026 corrected the end point of the arbeidskorting (132,920 EUR, not 132,290 EUR). The credits existed before 2026; it is our simulator that did not reproduce them. The correction has been live on the Netherlands page of the simulator since 8 November 2026, and the page’s source verification date moves to November 2026.

Worked example

Computed by our net salary simulator, single person with no dependants, employee below state pension age, without the 30% ruling, 2026 tax, before and after the correction of 8 November 2026. The Netherlands withholds no separate employee contribution: the ZVW health contribution is borne by the employer.

Above 132,920 EUR of employment income both credits are nil and the simulator’s figures are unchanged. Under the 30% ruling the credits are computed on the taxable wage after the allowance: at 90,000 EUR gross, the tax moves from 22,959.02 EUR to 17,420.51 EUR and the annual net from 67,040.98 EUR to 72,579.49 EUR.