In the Netherlands you pay tax with the tax office (Belastingdienst(opens in a new tab)). For a comprehensive overview on taxes in the Netherlands in English, check out this article(opens in a new tab). We have briefly summarised some important points from this article below.
If you have a working contract, then most of your taxes are organised and taken by your employer via payroll tax (loonheffing) which means you don’t necessarily have to do a yearly declaration. It is likely, however, that you will get a letter/email requesting you to declare annual income tax/tax return(aangifte inkomstenbelasting). You can follow the instructions in the letter and do it online.
If you are a freelancer, a different system of taxes applies. You have to do the annual tax return as well as a quarterly report on your taxes. Here(opens in a new tab) is a comprehensive overview of the VAT/BTW system or ZZP’ers. Remember to claim any expenses related to your company, for example, materials, equipment, transportation, rent of your studio, etc. But beware of not claiming too much back from the government if you plan on staying on applying for an Artist Visa in the future. When the Immigration Office reviews your application, it’s important that they see that your company is not only claiming money back.
Do I need to do a Dutch tax return?
The Dutch fiscal year runs from January 1 to December 31. In January, you will receive a letter (aangiftebrief) from the Belastingdienst asking you to complete a tax return for the previous year. If your financial affairs are simple (e.g. no tuition/healthcare costs, additional income/savings, overseas income, freelance income) then you may not receive a letter and you may not need to submit an annual tax return. You can always call the BelastingTelefoon on 0800 0543 to find out if you need to complete an income tax return and/or to request the letter.
What is the deadline for the Dutch tax return?
The time period for submitting your annual income tax return is from March 1 to April 30, unless you or your accountant request an extension (uitstel aangifte). You can do this via the BelastingTelefoon or the Belastingdienst website (you’ll need your DigiD). If you do not submit your tax return or request an extension before May 1 then you can be fined.
All taxpayers in in the Netherlands are entitled to receive the general tax credit (algemene heffingskorting) and every working person is entitled to receive the labour tax credit (arbeidskorting or loonheffingskorting). Both Dutch tax credits are calculated and credited to the tax balance on your salary by your employer, so it is not necessary to do anything to receive them (though, if you work multiple jobs, it is important to know that the tax credits can only be applied to one job, it is important to choose the job you work/earn the most at for the tax credits, and to communicate that to your employer(s)). If you work for yourself then the tax credits are calculated when you complete your annual tax return. The value of your tax credit depends on how much you earn, decreasing as your income increases.