Common Deductions You Might Be Missing

Key Takeaways

• The Netherlands has fewer deductions than many countries, but the ones available can save you thousands.
• Mortgage interest is the single largest deduction for most homeowners.
• Charitable donations are deductible if they exceed a threshold and go to recognized organizations (ANBI).
• Specific healthcare costs are only deductible for extraordinary, non-insured expenses.
• Fiscal partners can divide deductions between them to optimize their combined tax.
• Keep receipts and documentation — the Belastingdienst can request proof for up to 5 years.

How Deductions Work in the Netherlands

Dutch tax deductions reduce your taxable income in Box 1. This means the tax savings depend on your marginal tax rate:

• If you are in the lower bracket (up to €38,441): each €1,000 in deductions saves you about €370 in tax
• If you are in the upper bracket (above €38,441): each €1,000 saves you about €495 in tax

1. Mortgage Interest Deduction (Hypotheekrenteaftrek)

This is the biggest deduction for most Dutch residents. If you own a home and have a mortgage, you can deduct the interest paid on your mortgage from your Box 1 income.

Requirements

• The property must be your primary residence (eigen woning)
• The mortgage must be a qualifying loan (annuity or linear repayment since 2013)
• The deduction is available for a maximum of 30 years
• The interest-only portion is deductible; principal repayments are not

What You Can Deduct

• Mortgage interest payments
• Refinancing costs (under certain conditions)
• Penalty interest for early repayment (in the year paid)
• Notary fees for the mortgage deed (hypotheekakte) — in the first year only

What You Must Declare

You must also add the eigenwoningforfait (imputed rental value) to your income. This is a percentage of the WOZ value of your home:

Example

A homeowner with a €300,000 mortgage at 4% interest pays €12,000 per year in interest. With a WOZ value of €350,000, the eigenwoningforfait is €1,225 (0.35%). The net deduction is €12,000 - €1,225 = €10,775. At the capped rate of 36.97%, this saves approximately €3,983 in tax.

2. Charitable Donations (Giften)

Donations to qualified organizations are tax-deductible, but there are rules.

Regular Donations (Gewone Giften)

These are one-time or occasional donations. They are deductible only if:

• The organization is an ANBI (Algemeen Nut Beogende Instelling — public benefit organization) or a qualifying cultural organization
• Total donations exceed 1% of your threshold income (drempelinkomen), with a minimum of €60
• Maximum deduction is 10% of your threshold income

Periodic Donations (Periodieke Giften)

If you commit to donating a fixed amount for at least 5 years via a written agreement, the thresholds above do not apply. You can deduct the full amount without limits.

Cultural Bonus

Donations to cultural ANBI organizations (museums, theaters, orchestras) get a 25% bonus for the deduction calculation, up to a maximum bonus of €1,250. So a €1,000 donation to a cultural ANBI counts as €1,250 for deduction purposes.

3. Specific Healthcare Costs (Specifieke Zorgkosten)

This deduction is often misunderstood. It does not cover your regular healthcare costs or insurance premiums. It only covers extraordinary medical expenses that are not reimbursed by insurance.

What Qualifies

• Prescription medication costs above your insurance coverage
• Costs of prescribed medical aids (hearing aids, wheelchairs, prostheses)
• Extra costs related to disability or chronic illness
• Prescribed diet costs (fixed amounts per diet type)
• Travel costs to medical practitioners (€0.23/km)
• Costs of extra home help due to illness or disability

What Does NOT Qualify

• Regular health insurance premiums (zorgtoeslag compensates for these)
• Costs reimbursed by your insurance
• Dental care (including orthodontics) — unless medically necessary and prescribed
• Alternative/holistic medicine
• Cosmetic procedures
• Gym memberships or wellness programs

Threshold

You can only deduct the amount that exceeds a threshold based on your income. The threshold is roughly 1.65% of your threshold income (with a minimum and maximum depending on income level).

4. Alimony Payments (Alimentatie)

If you pay alimony to your ex-partner (partneralimentatie), these payments are fully deductible from your Box 1 income. The recipient must declare it as income.

Rules

• Only partner alimony is deductible — child support (kinderalimentatie) is NOT deductible
• The payments must be based on a court order or notarized agreement
• Voluntary additional payments are generally not deductible

5. Education Costs (Studiekosten) — Limited

As of 2022, the general deduction for education costs has been abolished. However, there are still some situations where education-related costs may be relevant:

• Business expenses for ZZP'ers — If you are self-employed and the training is directly related to your business, you can deduct it as a business expense (not as a personal deduction)
• STAP-budget — The government's STAP subsidy (€1,000 per year) replaced the deduction. Check if you qualify at stapuwap.nl

6. Temporary Stay Costs (Tijdelijk Verblijf Eigen Woning)

If you own a home but temporarily cannot live there (e.g., during renovation) and are paying for both your mortgage and temporary accommodation, you may be able to deduct certain costs. This is a niche deduction but can be valuable during major renovations.

7. Costs Related to Monumental Properties

If you own a registered monument (rijksmonument), maintenance costs for the monumental aspects of the property may be partially deductible. As of 2019, this is handled through a subsidy rather than a direct tax deduction, but the tax benefit for maintenance of the monument shell may still apply.

8. Negative Income from Your Own Home

If your mortgage interest exceeds the eigenwoningforfait, you have negative income from home ownership, which directly reduces your Box 1 taxable income. This is technically not a separate deduction — it is built into the mortgage interest system.

Fiscal Partner Optimization

If you have a fiscal partner (married, registered partnership, or qualifying cohabitation), you can strategically divide certain deductions between you:

What You Can Divide

• Mortgage interest and eigenwoningforfait
• Box 3 assets and debts
• Charitable donations
• Specific healthcare costs

Strategy

Assign deductions to the partner with the highest marginal tax rate to maximize the tax benefit. Assign Box 3 assets to the partner with the lowest income to maximize the general tax credit.

Deductions Expats Often Miss

30% Ruling Benefits Beyond the Ruling Itself

If you have the 30% ruling, you may also opt for partial non-resident taxpayer status for Box 2 and Box 3. This means you are only taxed on Dutch-source Box 2 and Box 3 income, potentially excluding foreign investments from Dutch wealth tax.

Foreign Tax Credits

If you paid income tax abroad on income that is also taxed in the Netherlands, you may be able to claim a foreign tax credit (voorkoming van dubbele belasting) to avoid double taxation. This is often overlooked by expats with investments or property abroad.

Moving Costs

Moving costs are generally not deductible for employees. However, if your employer reimburses your moving costs, the reimbursement may be tax-free under the work cost scheme (werkkostenregeling).

Documentation Checklist

Keep these documents for your deduction claims:

Common Mistakes

1. Claiming regular healthcare costs — Only extraordinary, non-insured costs qualify. Your €385 eigen risico does not count.
2. Forgetting the donation threshold — Regular gifts under 1% of your income (min. €60) are not deductible at all.
3. Not using periodic gift agreements — Committing for 5 years removes the threshold entirely.
4. Assigning deductions to the wrong partner — Always assign to the higher-earning partner for maximum benefit.
5. Not claiming foreign tax credits — If you paid tax abroad, you may be entitled to relief in the Netherlands.

What to Read Next

• Step-by-Step Guide to Filing — Learn how to actually file your return
• Which Form Do I Need? — Make sure you're using the right form
• Income Tax Calculator — See how deductions affect your final tax bill