Netherlands Tax Cheatsheet 2026
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The Belastingdienst taxes employment income in box 1 using three bands. Two tax credits then reduce the bill, so your effective rate is lower than the band rates suggest.
| Allowance / Band | Amount | Notes |
|---|---|---|
| Tax-Free Threshold | None (credits instead) | The Netherlands uses tax credits rather than a tax-free allowance |
| Box 1 Band 1 | Up to €38.883 | 35.75% (includes national insurance premiums) |
| Box 1 Band 2 | €38.884 – €78.426 | 37.56% |
| Box 1 Band 3 | Over €78.426 | 49.5% |
| General Tax Credit (Algemene heffingskorting) | Up to €3.115 | Full credit up to €29.736; reduces by 6.398% above that and ends at €78.426 |
| Labour Tax Credit (Arbeidskorting) | Up to €5.685 | Peaks at €45.592 of earnings; reduces by 6.51% above that and ends at €132.920 |
| Box 2 Lower Rate (Aanmerkelijk belang) | Up to €68.843 | 24.5% on dividends and gains from a 5%+ shareholding; the band doubles to €137.686 for fiscal partners splitting evenly |
| Box 2 Top Rate | Over €68.843 | 31% |
| Box 3 Tax Rate (Sparen en beleggen) | 36% | Charged on a deemed return, not actual gains |
| Box 3 Tax-Free Assets (Heffingvrij vermogen) | €59.357 | €118.714 for fiscal partners |
| Box 3 Deemed Returns | Savings 1.28%, other assets 6% | Debts above €3.800 (€7.600 for partners) reduce the return at 2.7% |
| Holiday Allowance (Vakantiegeld) | 8% of gross salary | Usually paid in May or June and taxed as normal income |
Want to see your take-home pay once the tax credits are applied? Try our Salary Calculator or Savings Goal Calculator
For informational purposes only, not tax advice. Figures apply to 2026 for people below state pension age and may change.
