Banking, Money and Taxes in the Netherlands
For an expat to open a bank account in the Netherlands, the following documents need to be provided:
- a valid passport
- a proof of address, such as a lease or utility bill
- some banks may also request proof of work, such as a contract
- a BSN or tax number
- a residence permit
The Dutch seldom use credit cards for anything except large purchases. There is a smart chip on most cards, and a loading system which allows the user to load a specific amount onto the card to be used as cash. This can be useful, but if the card is stolen, it can be spent by anyone. There may be some trouble finding a pay-point in some places, so carrying a little cash is always advisable. The banking system in the Netherlands is fairly simple, with most banks offering comparable packages. However, it's essential to shop around to find a bank that suits a person's specific spending habits. Some banks charge more for cash withdrawals than debits, for instance.
Upon moving to the Netherlands, an expat must get the BSN or SOFI number from their local tax office. This is the social security and tax number, and is required before one can get a job, or open an account.
Expats bringing specific and scarce skills to the Netherlands can apply for the “30 percent ruling”, which renders the first 30 percent of the expat’s salary tax-free. An application has to be made, and qualification is skill-dependent. The 30 percent ruling can make moving to the Netherlands a financially attractive proposition.
There are four tax brackets, ranging from 33.65 percent to 52 percent. The first two tax brackets include a 31.15 percent social securities contribution, which is levied on all residents.
An additional Health tax of 6.5 percent is levied on wages, and a 4.4 percent tax on life annuities up to an income of €30 000 per year. A further 25 percent flat-tax is applied to income from business interest. There is also a flat-tax of 1.2 percent on savings and investments on a yearly basis.
> Read our article explaining the Dutch income tax system
Netherlands tax consultants
> Read our article explaining the Dutch income tax system
Netherlands tax consultants
