Today is budget day!


Today is.png

I missed writing yesterday because I knew that today was the day the Dutch government announced their budget. Normally I don’t bother with blogging about this, but this is not an ordinary year. This time the implications for us were very high.

Now, the Dutch (like many other nations) have a tax advantage scheme to encourage highly skilled workers to immigrate to the Netherlands. This is commonly referred to as the 30% rule, because when you are a recipient of this ruling 30% of your salary is invisible for tax purposes. There are other implications of the ruling as well, but that’s the major one. Now, my husband is covered by the 30% ruling, and when we moved here it was granted for a period of 8 years. We knew that it was previously 10 years, and that there were political grumblings about shortening it again. But we thought that we wouldn’t be affected by that, as we had already had it granted to us, and when they changed it from 10 years to 8 years they did that for all new applicants. Those who still had time to run on the previous agreement weren’t affected. But earlier this summer the tax minister announced that from Jan 2019 it would be shortened to five years, for all new and existing cases. So for us it means that we would run out of the ruling in the summer of 2019, instead of 2022.

Now, the end of 30% tax ruling is a big jump in your tax bill – the last 30% of your salary has the highest level tax, and the Netherlands has a fairly high level of income tax. So it is a big deal. For us I think our monthly tax bill will go up about 1000 Euros. You can understand why I’ve been watching the news today!

And of course, this was only announced after we had agreed to purchase our new house. We, like many, had made important far-ranging financial decisions based on the assumption that tax agreements don’t change. Now there have been petitions and statements and all sorts of to-do, and group building and an action plan etc to try and persuade the government that this change shouldn’t be made retroactively. Fine, make all new immigrants have the 30% ruling for only five years, but don’t change it for those already here. And we have spent the summer hoping that it was enough.

Today we found out that it wasn’t enough and the government is not providing a transition agreement for people currently here under the 30% ruling. So we have a major headache working out how we can ensure that our house renovations are completed before this ruling comes in, as then our day to day expenses will get so much higher. And I’m frantic working out plans to earn money, while also trying to project manage a major renovation. More on my plans in the future.

One thing to be thankful for with these tax changes, is that if we hadn’t committed to our house move now we would have lost the opportunity. And at least we have til next summer, rather than being cut off in January when the changes come into effect.  But that doesn’t make the current headache any less!

2 thoughts on “Today is budget day!

Add yours

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Up ↑

%d bloggers like this: