How to file your taxes
Seeing that blue envelope from the Belastingdienst (tax office) drop through your mailbox may feel somewhat daunting but filing your taxes in the Netherlands is easier than you think.
Income tax returns in the Netherlands
In the Netherlands, the fiscal year runs from 1 January to 31 December. In the first week of February, tax authorities will begin to send out income tax return forms.
In general, tax returns should be submitted by 1 April. However, extensions are possible if you cannot meet the deadline.
Types of forms
Tax authorities issue various forms depending on an individual's situation. The most common forms are:
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P form: for those who are in a regular employment situation and have resided in the Netherlands for the entire fiscal year
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E form: a simplified P form which only mentions the basics
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M form: for those who resided in the Netherlands for part of the year
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C form: for those who are not residing in the Netherlands, but earn Dutch income
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W form: for the self-employed
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F form: for relatives of a deceased person
How the system works
If you have not received a form from the Belastingdienst, this does not indicate that you are free of tax obligations. If you have been employed in the Netherlands, payroll tax is withheld from your salary each month. The income tax calculation is as follows.
Salary ..........................................................100,000
Income tax due on salary .............................42,000
Less: payroll tax on salary ............................42,000
Balance ........................................................ 0
In the above situation, if you were employed for a complete year, you would not have to pay additional income tax. You would not receive a tax form from the authorities and would not be obliged to submit a return. However, you may have incurred tax deductible expenses during the year or could be entitled to a tax refund and should request a form.
It is important to note that if you received income which hasn't been taxed, you are legally obliged to request a form and file a tax return.
Filing your taxes
You can file your taxes digitally via the Belastingdienst website. However, the program is only available in Dutch and you will first need to apply for a DigiD. The other option is to enlist the help of a tax accountant or advisor. Many English-speaking advisors who specialise in expat and international tax issues have offices in Amsterdam.
Filing your first year’s return with an M form
If you arrived in or left the Netherlands in the course of the year, filing a tax return may be particularly advantageous.
Dutch wage and income tax is calculated on the basis of four progressive tax brackets. The tax withheld each month from your salary is calculated on the basis of your annual salary. If you worked for half a year in the Netherlands, you are entitled to a substantial tax refund. It is well worth your while to file a tax return, even if you have not received a form from the authorities.
After submission
After submitting a tax return, you will receive a preliminary assessment from the tax authorities. The preliminary assessment takes between 6 to 12 weeks after the return has been submitted. In the case of an M form, it can take up to 24 weeks before the assessment is made. The preliminary assessment is simply an estimation. Once tax authorities have checked the return, you will receive a final assessment along with payment or refund details.
More information
Step-by-step guide to applying for a DigiD
This article was written in part with information from Finsens tax advisors.
Expatcenter's Partner: Tax
Individual tax advisors
Corporate tax advisors
Further information
If you require further information, call the city information number 14 020 (Monday to Friday, 8:00 to 18:00).
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