The current amendments don't make it "much harsher than the 30 percent ruling valid until 2011," according to financial advisors Finsens, who clarify the implications for 2011 and 2012 applications.

30 percent ruling granted on or after 1 January 2012

New conditions

To qualify for the 30 percent ruling, the following conditions have to be met:

-          The employee is recruited from abroad;

-          The employee did not reside within 150 kilometres from the Dutch border at the time of hiring.

-          The employee's gross salary (inclusive of the tax free reimbursement under the 30 percent ruling) is at least  EUR 50,000 per annum;

-          The maximum duration of the 30 percent ruling is eight years;

-          Any period spent in the Netherlands over the last 25 years will be used to reduce the maximum duration of the 30 percent ruling.

PHD and masters graduates

PHD and masters graduates who are hired within a year of completing their studies will benefit from a relaxation of rules for this group:

-          The minimum salary requirement is EUR 38,007 gross (inclusive of the net reimbursement under the 30 percent ruling;

-          In the case of the PhD being completed in the Netherlands, the requirement of "being recruited from abroad" will not have to be met.

Scientific researchers

There will be no minimum required salary for scientific researchers who are employed by a university and/or a research institution that is subsidized by the government.

Scarcity on the labour market

The requirement regarding scarcity on the labour market, which is an important criterion under the ruling valid until the end of 2011, will be deemed to be met if the minimum salary requirement is met.  The ministry of finance indicated, however, that for sectors where every candidate meets the minimum salary requirement, the scarcity test will still be applied.

30 percent ruling granted before or on 31 December 2011

We can deduce that a request for the 30 percent ruling made in 2012, with retroactive granting back to 2011 would still fall under the 2011 rules. This is the case if the start date of the employment is in 2011, and the request is filed within four months after the start date of the employment.

However, in case of switching jobs, a new 30 percent ruling application needs to be submitted. The new requirements will then apply.

60 months check may influence eligibility

Under the current regulations, the ruling is granted for a period of 120 months (10 years).The maximum duration of 10 years will still be valid for the "old" rulings.  However, the first 60 months are fixed, but as of year six, the tax office has the possibility to check if the requirements of the ruling are still met by the employee.  

This 60-month check will still be applicable under the new regulations.

For those who have a 30 percent ruling granted before 2012 and haven't yet reached the 60-month period, the tax office can check after this period that the requirements under the new rules are met.

This means:

• the gross salary should, after the 60 month, be at least EUR 50,000;
• employees hired from within the 150-kilometer radius will no longer qualify after the first five years.

The 25 years requirement will however not be used when checking eligibility after five years.

For those who have already had the ruling for more than 60 months on 1 January 2012, the new tests on salary and distance will not have any consequences, even in the case of a job switch.

Source: Finsens Financial advisers

Learn about the latest developments in labour law and tax legislation in the Netherlands at the Annual Lexlumen/Expatica Congress on 16 December at the ABN AMRO headquarters in Amsterdam.