Dutch tax rates in 2026

Turnover tax (VAT) 2026

Turnover tax or VAT is the tax you pay on your sales. The standard VAT rate is 21%. You charge VAT to your customer. You can reclaim the VAT you paid on expenses and investments. You remit the difference to the Netherlands Tax Administration, usually quarterly.

Some goods and services are subject to the reduced rate of 9%, the 0% rate, or an exemption. Read more information about VAT.

From 1 January 2026, short-term stays in accommodation such as hotels and holiday homes are subject to the 21% rate. The rate for short-term stays at camping sites will remain at 9%.

Small Businesses Scheme KOR

If your annual turnover is below €20,000, you can apply for the Small Businesses Scheme (KOR). You will not have to charge VAT to your customers, but you cannot offset paid VAT either. 

Do you supply customers in other EU countries and is your total turnover less than €100,000? Then you may be able to make use of the EU-KOR. The EU-KOR came into effect on 1 January 2025.

Get advice from your bookkeeper, accountant, or tax adviser on whether the KOR or the EU-KOR are interesting for you.

Income tax 2026

You pay income tax on your personal income. Entrepreneurs with an eenmanszaak (sole proprietorship), VOF (general partnership), or maatschap (professional partnership) qualify for the entrepreneur allowance (ondernemersaftrek) and SME profit exemption (mkb-winstvrijstelling). These schemes reduce the taxable profit from your business. This means you pay less tax. 

Income tax rates

The various forms of personal income subject to income tax are taxed in separate boxes.

Box 1: Income from wages 

In box 1, you pay tax on your income from wages in 3 brackets. Profit from business is part of this. The tax brackets for 2026 are:

For state pension recipients born in or after 1946, a rate of 17.85% applies to income in the first bracket. 
For state pension recipients born before 1946, this lower rate applies to income up to €41,123.

Entrepreneur allowance 2026

Did you spend more than 1,225 hours working for your business? That means you meet the hours criterion and are eligible for the entrepreneur allowance (ondernemersaftrek). A part of this deduction is the private business ownership allowance (zelfstandigenaftrek), which is €1,200 in 2026. In 2025 it was €2,470. This amount will be reduced to €900 in 2027.

Is your taxable income €78,426 or more? Then you cannot use the rate of the highest tax bracket for personal deductions. The maximum rate for deductions in 2026 is 37.56%, the rate of the second bracket. This applies to the entrepreneur allowance, SME profit exemption, personal allowances, and paid mortgage interest. When you fill out the return, the rate is calculated automatically. The deduction limit does not apply to annuity expenses within the annual and reserve margin.

SME profit exemption 2026

You are allowed to deduct the 12.70% SME profit exemption from the profit remaining after deducting the entrepreneur allowance. This is the same as in 2025. This exemption is also subject to a maximum deduction rate of 37.56%.

Box 2: Income from a substantial business interest

Do you and your tax partner own at least 5% of the shares or profit-shares in a vennootschap (partnership), or voting rights in a coöperatie (cooperative)? Then you have a substantial business interest. The profit you receive from a substantial interest is taxed in income tax box 2.
In 2026, there are 2 brackets:

Box 3: income from savings and investments

Assets, such as savings or a second home, are taxed in income tax box 3. There is an annual exempt amount of €59,357 per person. This is the exempt amount for box 3 in 2026. The 2026 tax rate in box 3 is 36%. That is the same as 2025.

How to calculate (notional) returns has been the subject of much debate in recent years. Since 2023, the Box 3 Bridging Act applies. This act introduces a new way to calculate income from savings and investments. This new method is based on the actual split between savings and investments. The assumed returns are determined retrospectively and therefore better reflect reality.

For provisional assessments, the Tax Administration calculates using provisional figures. In 2026, for bank deposits, this is 1.28% and for debt 2.70%. In 2025, it was 1.44% and 2.62%.
For other assets, the final rate of return in 2026 is 6.0%. That was 5.88% in 2025.

A Supreme Court ruling means you can now prove that your actual return was lower than the notional return. If you meet the conditions and qualify, you will receive a letter from the Tax Administration.

Use the Tax calculation tool

You can check what the new income tax rates mean for your situation using the Dutch-language Income Tax Calculation Tool.

Tax credits 2026

You deduct the tax credits from the calculated income tax in the 3 boxes. Which tax credits you qualify for depends on your personal situation and income. In 2026, your total income from boxes 1, 2, and 3 will count towards the general tax credit. For the other tax credits, only income from box 1 counts.

Corporate income tax 2026

If you are a partner in a legal entity, like a BV (private limited company), the legal entity pays corporate income tax (vennootschapsbelasting) on its profits.

Dividend tax 2026

You can decide to keep the profit after tax in the company. If the company pays it out to shareholders as a dividend, it must withhold 15% dividend tax (dividendbelasting). 
Is the shareholder another legal entity owning at least 5% of the shares? The participation exemption applies, and you do not have to withhold dividend tax.

Excessive borrowing

Directors of a legal entity with 5% or more of the shares in that legal entity are director-major shareholders (DGAs). These are usually managing directors of a BV. Does a DGA borrow more than €500,000 (same as in 2025) from their own BV for their private use? This is called excessive borrowing. The DGA must pay tax in box 2 of income tax on the part above that limit. That borrowed amount is a debt of the DGA’s own BV. The debt level on 31 December is the reference point for the tax payable.

Customary salary for DGA

A director-major shareholder is also an employee of the legal entity, usually a BV. For this, the DGA must receive a wage that is customary for the activities. In 2026, this customary wage is at least the highest of the following 3 amounts:

• The salary of an employee in the most comparable employment.
• The salary of the highest earning employee of the BV or of an affiliated company.
• €58,000 (was €56,000 in 2025).

Income-related healthcare insurance contribution 2026

Besides the basic monthly health insurance premium, there is also an income-dependent health insurance contribution. For employed persons, the employer pays this premium. Self-employed people pay the reduced income-dependent contribution via an assessment from the Tax Administration.

Legal minimum hourly wage 2026

From 1 January 2026, the minimum wage for employees aged 21 and over is €14.71 per hour.
The minimum youth wages as of 1 January 2026 are:

The minimum youth wage is derived as a percentage from the minimum hourly wage. The government’s Voorjaarsnota (spring memorandum) 2025 indicated that from 2027 these rates will be increased (in Dutch) .

Amounts of benefits in 2026

In 2026, the following amounts and percentages apply for the various benefits, excluding holiday pay:

Dutch participation act (social assistance)

IOAW/IOAZ 

The joint income is supplemented to these maximum gross amounts:

WW, WIA, WAO, ZW

AOW

Volunteers allowance 2026

You can pay untaxed compensation to people who do voluntary work for your company or organisation. This voluntary allowance in 2026 may not exceed the maximum amounts per hour, per month, and per year.

Company car 2026

If you have a company car and also use it privately (for more than 500 kilometres per year) you pay a private use addition (bijtelling). That amount is added to the income in box 1 of the income tax. For a car registered in 2026, the rate is 22%. For emission-free (electric) passenger cars, a 4% discount applies in 2026 (was 5% in 2025) up to a maximum list value of €30,000.

For cars aged 15 years or older (young timers) on 31 December 2025, the rate will be 35% on the list value. From 2027, only cars 25 years or older will fall under this scheme.

Travel allowance 2026

The untaxed mileage allowance for business travel expenses using own transport remains €0.23 per kilometre in 2026. This amount also applies to commuting expenses.

Home-working allowance

Employees who work from home can receive an untaxed allowance of €2.45 per day worked from home. In 2025, this was €2.40. 

Tax return 2025

Are you still working on your 2025 tax return? Then take a look at the 2025 Dutch tax rates.