Tax Glossary
Dutch tax terms explained in plain language
Belastingdienst(Dutch Tax Authority)
The Dutch Tax and Customs Administration, responsible for collecting taxes and enforcing tax laws in the Netherlands.
Aangifte(Tax Return)
Your annual tax return (aangifte inkomstenbelasting), which you file with the Belastingdienst to report your income, deductions, and assets.
Box 1(Box 1 (Income from Work and Home))
The first of three tax boxes. Box 1 covers income from employment, business profits, and your primary home (eigenwoningforfait). Taxed at progressive rates.
Box 2(Box 2 (Substantial Interest))
The second tax box covers income from a substantial interest (5%+) in a company, including dividends and capital gains from selling shares.
Box 3(Box 3 (Savings and Investments))
The third tax box covers wealth — savings, investments, and other assets. Taxed based on a fictitious yield (assumed return) rather than actual returns.
Heffingskorting(Tax Credit)
A tax credit that directly reduces the amount of tax you owe. The main types are the general tax credit (algemene heffingskorting) and the labour tax credit (arbeidskorting).
DigiD(DigiD (Digital Identity))
Your digital identity for Dutch government services. Required to file your tax return online, access MijnOverheid, and interact with the Belastingdienst.
BSN (Burgerservicenummer)(BSN (Citizen Service Number))
Your unique citizen service number in the Netherlands, similar to a Social Security Number. Used for tax, healthcare, and government services.
Eigenwoningforfait(Imputed Rental Value)
The imputed rental value of your own home, added to your Box 1 income. A percentage of your home's WOZ value that is treated as taxable income.
Hypotheekrenteaftrek(Mortgage Interest Deduction)
The deduction of mortgage interest payments from your Box 1 taxable income. One of the largest tax benefits for homeowners in the Netherlands.
WOZ-waarde(WOZ Value (Property Valuation))
The value of your property as determined by your municipality under the WOZ Act. Used to calculate property taxes and the eigenwoningforfait.
ZZP (Zelfstandige Zonder Personeel)(ZZP (Self-employed without staff))
A sole trader or freelancer who works independently without employees. The most common business structure for freelancers in the Netherlands.
KVK (Kamer van Koophandel)(KVK (Chamber of Commerce))
The Dutch Chamber of Commerce where all businesses must register. You receive a KVK number upon registration.
BTW (Belasting over de Toegevoegde Waarde)(VAT (Value Added Tax))
Value Added Tax charged on goods and services. Standard rate is 21%, reduced rate is 9% for essentials. Businesses charge and remit BTW to the Belastingdienst.
30%-regeling(30% Ruling)
A tax benefit for highly skilled migrants recruited from abroad. Up to 30% of your salary can be paid tax-free to compensate for extraterritorial costs.
Fiscaal Partner(Fiscal Partner)
Your tax partner for filing purposes. Fiscal partners can divide certain income and deductions between them to optimize their combined tax burden.
Voorlopige aanslag(Provisional Assessment)
A preliminary tax assessment issued by the Belastingdienst before your final return is processed. Can result in monthly payments or refunds throughout the year.
Jaaropgave(Annual Income Statement)
An annual statement from your employer showing your total salary, tax withheld, and social security contributions for the year. Needed for filing your tax return.