Payroll Tax: Who Qualifies and What You Get
Learn how payroll tax works in the Netherlands and how to use tax credits to manage your monthly take-home pay.
Payroll tax is a mandatory deduction taken from your earnings to cover various national taxes and social contributions.
Who it's for
This applies to all employees working in the Netherlands.
What you get
You can use a specific tax credit, known locally as loonheffingskorting, to reduce the amount of tax taken from your pay. This helps increase your monthly netto salaris (take-home pay) if you only have one employer.
What it costs you
This is a deduction from your gross salary, meaning it reduces your total pay before you receive it.
The catch to know
If you have two or more jobs at the same time, you must only apply the tax credit to one of them. If you apply it to multiple jobs, you may end up owing money to the tax authorities later.
How to apply
- Discuss your tax credit status with your employer.
- Decide which employer should receive the tax credit if you have multiple jobs.
- Check your monthly payslip to ensure the deduction is correct.
- Visit the official portal for more details: https://www.belastingdienst.nl