Netherlands: Payroll tax, wages, salaries tax proposals | KPMG | GLOBAL

Netherlands: “Budget day” payroll tax, wages and salaries tax proposals

Netherlands: Payroll tax, wages, salaries tax proposals

In the Netherlands, on “budget day” (19 September 2017), the caretaker Cabinet presented a package of measures for the 2018 tax plan to the Lower House that include proposals for changes to payroll taxes.

1000

Related content

There are also proposals to changes to the wages and salaries tax and to national insurance contributions reduced remittances law (Wet vermindering afdracht loonbelasting en premie voor de volksverzekeringen), as laid down in the 2018 tax plan and other tax measures for 2018. The proposed changes generally would be effective 1 January 2018.

There are also measures concerning the partial exemption for the taxable benefit derived from share options of start-ups (as adopted in 2016 as part of the 2017 tax plan) and the salary costs (incentive allowances) provisions (Wet tegemoetkomingen loondomein), part of which will take effect 1 January 2018. 

Tax rate proposals

  • The individual (personal) tax rate in the second and third payroll tax and individual income tax brackets is 40.80% in 2017. As of 1 January 2018, the tax rate in both brackets would be increased by 0.05% to 40.85%. 
  • The tax rate in the fourth payroll tax and individual income tax bracket is 52% in 2017. It would be reduced by 0.05% to 51.95% as of 1 January 2018. 
  • The brackets would be extended—meaning that in 2018, the fourth bracket would begin with taxable income of more than €68,507. 
  • As of 1 January 2018, the combined tax rate in the first bracket would be 36.55% (the same as in 2017).

 

Read a September 2017 report prepared by the KPMG member firm in the Netherlands

The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

Connect with us

 

Request for proposal

 

Submit