If you live in Germany and work in the Netherlands, you have to deal with both the Dutch and the German tax authorities. In Germany, this situation (working in the Netherlands) is about income tax and in the Netherlands it is about wage tax/income tax. The Netherlands and Germany have a double taxation agreement, and therefore you have to pay tax on your salary in the Netherlands only, for example, and not “also” in Germany.
If you work in the Netherlands, you are liable to pay income tax on your wages in the Netherlands. If more than 90% of your annual income falls within the scope of Dutch taxes, you can file a tax return in the Netherlands as if you lived in the Netherlands. This means qualified foreign tax liability. The possible advantage is that you can deduct your mortgage interest from your tax. In general, Dutch income tax is lower than German income tax. Dutch wage tax is comparable to German tax class 3. Dutch taxes are progressive, just like in Germany. This means that you pay higher taxes if you have a higher income. Tax returns in the Netherlands must be filed annually by 1 July.
Payroll taxes (Loonheffing)
An important difference to the German tax authorities is that the Dutch tax authorities also collect social security contributions. On your pay slip you will see the withholding ‘loonheffing’. This is not only the wage tax, but also the contributions to the Dutch national insurance schemes.
Filing a joint tax return
If you live with someone, it is possible for your partner to file a tax return in the Netherlands as well. One condition is that your partner also meets the 90% requirement or that the joint income meets the 90% requirement. In this case, they can apply for a tax reduction, an amount of approximately â‚¬ 1,000 per year. To file a tax return in the Netherlands, your partner needs a Citizen Service Number (BSN).
A joint tax return does not affect the actual tax payable compared to a tax return for a single person. Only the official procedure is different.
For more information on qualified foreign tax liability, see the tax authority’s website.
Some professional groups enjoy an exemption with regard to taxes. These are lecturers with fixed-term employment contracts, international drivers and personnel in air transport or shipping. In addition, the wage tax of workers posted to the Netherlands by a German recruitment agency is regulated differently. Special rules also apply to workers posted elsewhere.
If you belong to one of these groups, it is important to consult an expert. You will find the contact details below:
- Belastingdienst Buitenland (Foreign Tax Authority) in Heerlen: +31 55 538 53 85
Team GWO (joint department with experts from the Dutch, German and Belgian tax authorities)
- from Germany: 0800 101 1352
- from the Netherlands: 0800 024 1212.
Moving to or from the Netherlands
If you have only lived in the Netherlands for part of the year, file an M-tax return. As of 1 June 2021, you no longer have to file your M-tax return on paper. You can also submit it online using your DigiD or a European-approved login tool (eIDAS).
Read more here: https://www.belastingdienst.nl/wps/wcm/connect/de/privatpersonen/inhalt/teil-nicht-in-den-niederlanden-leben-m-steuererklaerung