Duration of 30% rule reduced from eight to five years

The government intends to reduce the duration of the 30% rule from eight to five years with effect from 1 January 2019. The proposal covers both new and existing situations. The Council of Ministers agreed to this on the proposal of the State Secretary for Finance. If the proposal is accepted by Parliament, all 30% decisions that run for more than five years on 1 January 2019 will end abruptly.

The Cabinet intends to include the changes in the package of the Tax Plan 2019 that will be announced on Budget Day 2018 (“Prinsjesdag”).

What can you already do as an employer?
The 30% rule is, of course, a tax facility and not a condition of employment, but it may still raise the necessary questions among the employees concerned. It may be wise to check which employees will be affected by the proposed changes as from 1 January 2019, so that you can prepare your employees in good time for the new conditions should the proposed changes be implemented as from 1 January 2019.