On the night of October 26 to 27, two amendments were unexpectedly adopted with regard to the 30% ruling.
First of all, a graduated scheme will be introduced from 2024.
A tax free reimbursement of 30% applies in the first 20 months, 20% for the next 20 months and 10% for the last 20 months.
A transitional arrangement applies to employees for whom the 30% ruling is applied in December 2023; these employees will not be confronted with the cuts. However, if they change employers and do not consecutively start working for the new employer, they will lose the transitional arrangement and the new measure will also apply to them from the moment of the interruption.
Another, less unexpected change concerns the abolition of the partial foreign tax liability as of 2025.
This means that it is no longer possible to opt to be treated as a non-resident for Box 2 and 3. In practice, this will mainly mean that employees with the 30% ruling will now also owe Box 3 tax.
Employees for whom the 30% ruling is applied in December 2023 will only be confronted with its abolition from 2027. However, if they change employers prematurely and do not consecutively work for the new employer, the partial foreign tax liability only applies until the moment of the interruption
The Tax Plan has been adopted by the House of Representatives, but the Senate will still have to approve it on December 19. The Tax Plan is expected to be adopted.
If that is indeed the case, then the introduction of the graduated scheme in particular could lead to problems in practice. The chance that an error is made in the payroll administration when processing an employee’s wages with the 30% scheme is considerable.
There have been many changes to the scheme in recent years. These new changes add a new chapter to the complexity of the 30% ruling.