Social Security and Tax
Living with tax in the Netherlands means you will be confronted with the Belastingdienst (tax service) sooner or later. Until 2018, this Dutch tax office operated under the slogan ‘we can’t make taxes more fun, but we can make it easier’. Most expats will find that it was no coincidence that the Belastingdienst chose to stop using the slogan; despite their efforts expats still encounter a lot of paperwork. Luckily, We4Expats are happy to adopt this mantra as we guide you through all the administrative necessities needed for living in the Netherlands.
Belastingdienst and expats
Living in the Netherlands means having frequent contact with the Belastingdienst. This Dutch tax office is a government department that is part of the Dutch Ministry of Finance and executes custom duties, excise duties, but most above all collection of taxes in the Netherlands.
Due to the Dutch ‘Toeslagen’ (allowances) system, the Dutch tax office also handles the payment of social & healthcare allowances, as well as unemployment benefits. Though not all of the above apply to everyone, as an expat you will surely have to deal with the Belastingdienst with the following:
- Applying for a social services number (BSN)
- Applying for the 30% ruling
- Filing in your annual income tax (return)
- Applying for allowances (we can help you to see for which ones you are qualified)
- For freelancers and entrepreneurs; file in your quarterly sales tax
Some taxes, especially when owning your own house, are regulated by the local city councils. These are called gemeentebelastingen and consist of taxes on waste, property and tourism. Not everyone will have to deal with all of these, but it is important to be informed on what taxes might apply to you to avoid surprise payments.
Lastly, as the Netherlands is below sea level and full of rivers (and very clean drinking water), the waterschappen taxes people for flood protection and clean water.
In the Netherlands, taxes are handled almost entirely online. In 2016, the Belastingdienst moved their correspondence from envelopes to mail and what is called DigID. DigID is short for digital identification and is used as an online equivalent of your passport.
To apply, you set up an account at www.digid.nl/en/. You will be asked to fill in your credentials after which a text message will be sent to your phone. You will then be asked to choose a username and password. A text will again be sent to your telephone number to verify your phone number, a mail will be sent to verify the email address you entered and lastly a letter will be sent to your house that contains a code. Use this code to complete your registration within 20 days.
Once verified, you can use this login for almost anything government related, including taxes. Please keep the login credentials safe and secure.
What other services does DigID give access to?
DigID is a broadly integrated software technique that goes far beyond just your taxes or correspondence with the government departments, Belastingdienst and local city councils. You will be asked for your DigID for all of the following as well:
- Healthcare provides
- Healthcare insurance companies
- Pension Funds
- Contact with the police
- Registering with a bank
As the registration for DigID takes a few days (due to the letter), remember to start applying for it timely to avoid delays in your (financial) administration.
Calling the Belastingdienst
Although you will find that communication with the Belastingdienst is mostly online, you can still call the Belastingdienst when you are in need of clarification. You can call the so-called Belastingtelefoon (tax telephone) for free on 0800 0543 to get information, assistance and answers to tax related questions. When calling from abroad, you can use the number +31 555 385 385.
Belastingtelefoon in another language?
Despite the growing number of foreigners living in the Netherlands, the Belastingtelefoon is only available in Dutch. This has a specific reason as the Dutch tax office decided back in 2008 that offering English led to too many misunderstandings between clients and tax office employees. Some of which had big financial and legal implications.
This doesn’t mean that you can’t try as some of the employees at the helpdesk speak perfect English, but there are no guarantees. You will also have nothing to fall back on when a misunderstanding leads to implications. As an alternative, you can ask We4Expats for advice on tax related issues.