A termination agreement can contain the following information: In order to receive unemployment benefits under the Dutch Unemployment Insurance Act (WW) after a redundancy package, the employee (expat) must be involuntarily unemployed. The Belastingdienst (Dutch tax office)collects taxes through a variety of streams. An employee is entitled to a statutory redundancy payment if he is made redundant after being continuously employed by the employer for at least two years. The golden handshake still exists today, even after the severance packages were cut back drastically in 2015 with the implementation of the Work and Security Act. If you earn money while living in the Netherlands, you need to pay taxes. We do not recommended to enter into a settlement agreement when you are sick (arbeidsongeschikt). This is: - 0.5 gross monthly salary per year of service up to the age of 35. Snijders for further information about redundancy package, settlement agreements and termination agreements: 0031 20 5221999. in Amsterdam wegens corona -, Opzegging arbeidscontract en schadevergoeding -, What are the consequences for a subtenant if the Dutch tenancy agreement between the main tenant and the landlord e…, Wat zijn de gevolgen voor een onderhuurder als de huurovereenkomst tussen hoofdhuurder en verhuurder eindigt? Telephone +31 (0)30 2468 536 Reach us by phone from 9:00 to 12:30 and 13:30 to 17:00. A settlement agreement will be considered as the final arrangement of all the issues between the parties in relation to the employment, since the contract prevents or limits future disputes. Then the payment is not only taxed at the 52% tax rate, there is also a 20% tax on the total amount. To avoid later discussion about the mutual consent of the termination, most employers offer an allowance for legal expenses. The maximum payment stipulated by law equals to 12 month s' salary. If the employer does not comply with his obligation to inform the employee, the period is extended to three weeks. This can impact your: income tax; Working for Families tax credits entitlements; KiwiSaver; student loan; child support. The Tax and Customs Administration collects income tax. 1. The transition payment depends on the monthly salary and number of years of employment. You state that you will also receive a lump sum - also known as an ex-gratia payment - of €14,000. Tax-free entitlements. The transition compensation is not obliged in case of a settlement agreement. Some will fall within the £30,000 exemption, and some are entirely free of tax. Settlement agreements are offered in The Netherlands to employees when they are being made redundant and in case of involuntarily unemployment. However, non-residents who are residents of an EU or EEA Member State, Switzerland, or one of the BES islands, may receive the same tax treatment as that of residents if they pay tax in the Netherlands on more than 90 percent of their worldwide income and can submit a personal income statement from the tax authorities of the state of residence. An employer should pay a transition compensation to the employee if: 1. the employment lasted two years or longer, and 2. the employment (indefinite term or temporary) terminates at the initiative of the employer, and 3. the termination is not for serious cause, and 4. the termination does not take place after the retirement age. Ex-gratia redundancy payments above the statutory redundancy amount are exempt from USC up to certain limits. This is taxed as part of the current year's income. The statutory redundancy is tax-free. Redundancy payments. How to minimise the tax payable on a redundancy payment . If their total value exceeds 1.5%, the employer must pay 80% tax on the excess. The employer has the obligation to inform the employee in written of his right to rescind the agreement within14 days from signing, without specifying his reasons. A certain amount of your redundancy payment is tax free, as described above, and the balance will be taxed. The bracket part of annual income generated through rental of a building from RWF 180,001 to RWF 1 million is taxed at 20%. Our Dutch lawyer Labour and Employment Law in Amsterdam, The Netherlands, is specialist employment solicitor advising foreign employees and expats on redundancy package and settlement agreements (Compromise Agreement, Employment Exit Agreement, Employment Separation Agreement or Termination Agreement) according to Dutch Labour Law. If it is a considerable sum, you could end up in a higher tax level for that particular year and this may not be the best idea from a tax point of view. The duration of the period of notice is often stated in the labour agreement. Once the agreement is signed, an employee can not bring any employment claims against the employer in connection with the employment or its termination. We specialize in international and Dutch Labour & Employment law. This rises to 15 month s' salary for employees aged 50 or older, with at least 15 years of continuous service, and to 18 month s' salary for employees aged at least 55 and with at least … The 30% ruling is not applicable on the transition payment. Redundancy may mean you earn more, or less, than you would normally expect in a financial year. You can have your termination agreement checked by our experienced Dutch solicitor (lawyer) Employment and Labour Law in Amsterdam. Receiving a golden handshake in lieu of a termination of an employment contract will mean the lump sum payment will be taxed. This amount is taxed in the Netherlands. Previously there was a second method based on your average rate of tax for the previous 3 years. On a redundancy or retirement payment, you are entitled to one of the following tax exemption options, whichever is the higher. The Dutch tax system, especially for expats, is anything but simple. In this case you will have to pay tax on the full amount. In that case, you pay tax in Belgium over a period of 1 year. According to the Dutch Tax Law, this amount can be paid out in three different ways: 1. Go to list page. Another common factor is that the situation may simply not justify dismissal. Effective 1 January 2020, a transition payment is mandatory whenever an employer terminates or fail to renew a temporary employment contract. An annuity is a form of saving or investment in which the beneficiary receives fixed periodic payments. The termination of employment relationships by a termination agreement is required to be in written form to be valid. That is your gross pay. As a qualifying non-resident taxpayer, you must pay taxes in the Netherlands on more than 90% … The statutory redundancy payment is calculated by reference to the employee’s age, length of service and gross weekly pay. HMRC Forms mode: … For dismissals on or after 1 January 2020, use this online calculation tool (in (c) Advocatenkantoor WS Advocaten Amsterdam, WS Advocaten en mediators Amsterdam |Rooseveltlaan 2 - 4, Unemployment benefits according to Dutch Labour Law, Dutch Labour Law: notice period in The Netherlands, Consideration after signing settlement agreement, Sickness Benefits Act in The Netherlands for expats, Legal advice for employees and expats in Amsterdam. We use cookies to improve and analyse the use of our website. This is: - 0.5 gross monthly salary per year of service up to the age of 35. Special attention goes out to employees with the 30% ruling and other kind of “international” employees. We can assist you in negotiating a balanced and fair redundancy payment. As a cash payment. Basic Exemption and Increased Exemption . In some cases the tax could be mitigated using longer term insurance arrangements. Transitional arrangements are in place for annuities granted before 1 January 2014 that qualified for the annuity exemption for redundancy pay. Phase: Management Type: Severance pay/redundancy compensation. She also gets to keep her company car, which is valued at £8,000. The tax-free amount is not part of the employee's ETP. The duration of the employment contract makes no difference. Since 2006, the unemployment benefits will be granted by the Employee Insurance Agency of The Netherlands, UWV (Employee Insurance Agency), as long as the employment agreement is: Our lawyer recommends that parties lay down their mutual consent about the termination in a valid settlement agreement to obtain unemployment benefits. The B-factor is the corrected monthly gross salary, which includes fixed components like holiday allowance. You need to also ensure that any further tax deducted due to the redundancy payments is covered within the tax deducted box on screen "Please enter any tax deducted from these payments and not entered elsewhere" Now the entirety of the £100,000 and all associated tax deducted has been declared on the return and the tax generated should be as expected. All these payments are taxable and should be declared on your tax return. It is not without reason that our motto is: "Your problem, our concern.". Any savings and investments you have as an expat will also be subject to Dutch income tax. Our Amsterdam lawyer always tries to cover our fees by seeking payment from your employer rather than from you. The judge then has the freedom to award up to one and a half times the transition allowance. The years of service up to age 35 will count as 0.5, the years of service between 35 and 45 years of age will count as 1, the years of service between ages 45 and 55 will count as 1.5 and the years of service above age 55 will count as 2. By Andy Leeks. Negotiations and legal advice on Dutch redundancy packages for expats The transition compensation is considered to be wage subject to wage tax/national insurance contributions and the income-related healthcare insurance contribution. Another common factor is that the situation may simply not justify dismissal. Proposed rules as of 2014. Huurverlaging voor ondernemers (horeca, winkels, etc.) Redundancy Payments – If you lose your job any redundancy payment is regarded as income – so you will be taxed at your highest tax rate band. In the Netherlands, a certain amount of mitigation can be obtained by similarly spreading the income receipts if the gross amount of the compensation is paid … FREE guide on how to minimise your tax bill* … Employees over fifty who have been working for more than 10 years for an employer, are entitled to deviant transitional regulation. The parties are free to make an appropriate arrangement, but often seek alignment with the legal system and the expected severance payment in the event of a proceeding. Employers may provide such items tax free only if their total value is less than 1.5% of salary costs. ‘co-op’) in a business-driven structure, a widely used vehicle for holding and financing activities, although anti-abuse rules are applicable. Statutory redundancy is the amount which must be paid by the employer to the employee under employment law and will be a fixed amount for each year of service. The settlement agreement or redundancy package outlines the terms of the deal. There is no income tax or NIC to pay on statutory redundancy payments. Whether you're a Dutch citizen or an expat, you are required to pay taxes if you earn money while living in the Netherlands. The Cantonal Court Formula fixes the redundancy payment at a number of months salary. - 1 gross monthly salary per year of service between the age of 35 and 45. The C-factor is a correction factor that in redundancy situations is usually 1.0 (neutral dissolution), but may be fixed at a higher or lower level by the Court in order to come to a fair and adequate severance payment. monthly pay (gross monthly salary) including holiday allowance. The problem is that the tax may not be correct once other income of the tax year is taken into account. The Basic Exemption is €10,160, plus €765 for each complete year of service. Although most redundancy payments will fall below the £30,000 threshold, they will still use up part of the tax-free band, so if the total compensation paid … The first £30,000 of any redundancy payment for compensation for loss of office is free of income tax and National … If the employer would go to the Dutch Dismissal Authority UWV or the sub-district court, the employment contract would probably not end. In such cases, the only viable solution for the employer is to enter into a termination agreement with the employee. An employer should also pay a transition compensation to the employee if the employment (indefinite term or temporary) terminates at th… Do you live in the Netherlands and receive a benefit from Belgium in connection with redundancy, illness or disability? In general, this does not apply to the Dutch cooperative (i.e. If you end up owing tax on your redundancy pay above £30,000, you may be able to minimise your bill by paying into a pension. An important provision in a Dutch redundancy package relates to the  ‘transition compensation’ (statutory severance payment, redundancy compensation or dismissal compensation). WS Advocaten Amsterdam use third party analytics cookies. In the situation that no tax treaty is applicable, employment compensation paid to an employee with a Dutch wage tax withholding agent, who performs their services outside the Netherlands and who is not liable to tax outside the Netherlands, will in principle be taxed in the Netherlands provided that the employee also performs some employment activities in the Netherlands. Wealth Tax – The Netherlands has a wealth tax (Box 3) on savings, property and investments. Redundancy payments are normally taxed as "compensation" rather than earnings. 8 min Read Published: 21 Sep 2020 Reader Question: Hi, I am due to receive a redundancy payment of £116,000. From January 1, 2020, statute provides that the ordinary redundancy payment amounts 1/3 of a monthly salary per full year the contract has lasted. If the redundancy is amicable, a formula called Cantonal Court Formula (Kantonrechtersformule) used as a starting point. My landlord in Amsterdam does not return my deposit, Deposit and/or additional costs in a Dutch rental agreement, Advocatenkantoor Amsterdam voor familierecht, Adviseur gespecialiseerd in ambtenarenrecht, Continued payment of remuneration up to the end of the employment relationship, not terminated based on urgent reasons (if the employee is grossly to blame for the dismissal). Your employer will deduct tax and National Insurance contributions from any … Our Amsterdam lawyers will advise you fully on all the implications of signing the Settlement Agreement. As a rule, an employee is entitled to a severance payment if the employer takes the initiative to terminate the employment contract. By offering a high severance package, the employer will usually give the employee a sufficient incentive to accept the offer. This Calculator is based on the publicly available guidelines and publications about redundancy payment that can be found in the Notice of Termination & Redundancy Pay guide based on … This may vary depending on the individual circumstances of the case. The amount of a transition compensation is calculated using a formula based on: The transition payment is capped at € 77,000, unless the employee’s salary exceeds that amount. Negotiating redundancy payments in the Netherlands. Wat zijn de gevolgen voor een onderhuurder als de huurovereenkomst tussen hoofdhuurder en verhuurder eindigt? Because of the way that relief for the personal allowance is given through the payroll, if Tom does not work for the rest of the year, or only has a small income, such as JSA, he may find that he can claim a tax refund for the year of redundancy … Redundancy Calculator. The maximum amount is set yearly and is €84,000 in 2021. This is no different if the employment contract ends by means of a settlement agreement. The current level of statutory redundancy is limited to £350 per year of service, up to 20 years’ service and multiplied by up to 1.5 depending on the age of the worked, so the maximum statutory redundancy amount is £10,500. Benefits under the Dutch Sickness Benefits Act are not possible in that case. in Amsterdam wegens corona, Opzegging arbeidscontract en schadevergoeding bij accepteren ontslag. The 30% ruling is not applicable on the transition payment. The expected outcome of a possible procedure therefore plays an important role in the negotiations on the redundancy payments in the settlement agreement. This, however, is only the case if the fair market value of your savings and investments exceed 20.315 euros. The A-factor is the adjusted number of years of service of the employee. How can I reduce the tax I will have to pay on this amount? In Germany and the Netherlands severance pay is treated as fully taxable. If you live in an EU or EEA Member State, Switzerland, or one of the BES islands (Bonaire, Sint Eustatius, or Saba), you are part of this category. The amount of a week’s pay … Depending on the grounds for dismissal, a procedure must then be chosen via the Dutch Dismissal Authority UWV or via the subdistrict court judge. Dividends from Dutch corporations are generally subject to a 15 per cent Dutch dividend withholding tax. Correspondence Address. The transition compensation should compensate employees for their loss of earnings and costs such as costs for scholing or outplacement. Contributions paid into your pension qualify for tax relief at the highest level of tax you pay – so 20% for basic-rate payers, 40% for higher-rate payers and 45% for additional-rate payers. The redundancy payment, less tax, was paid to Tom with his final wages, which were taxed using his normal tax code. What you need to know. Redundancy payments fall into two categories: statutory payments and non-statutory payments. This means that if an employee’s adjusted net income reached £125,000 when redundancy pay was taken into account, their personal allowance would be removed for that tax year.” Ingram adds: “Once taxable income is over £125,000, no personal allowance is left, costing the taxpayer up to £5,000 a year.” The Amsterdam team of specialist Dutch Employment Law Solicitors have a vast amount of experience in advising expats on all Dutch (redundancy) situations. Tax on redundancy pay: Example 2. Redundancy Payments – If you lose your job any redundancy payment is regarded as income – so you will be taxed at your highest tax rate band. It is advisable to consult us before you make an important decision regarding the termination of an employment contract. A provision is a.o. In this case, severance payments of half a month’s wage for each year of the employment relationship can be filed. You are entitled to legal consultation regarding your redundancy package or settlement agreement in order to prevent subsequent discussions and legal proceedings. Some employers will be prepared to pay more than just the statutory severance payment in case of a redundancy package. Here are the main tax types that you will most likely encounter in the Netherlands: If you live outside the Netherlands, but pay taxes in the country on most of your annual income, you fall under the category of a “qualifying non-resident taxpayer”. Please contact our specialised and experienced lawyer Dutch Labour and Employment Law in Amsterdam, The Netherlands, mr. P.Chr. Examples Example 1 - redundancy settlement with a compensation payment over £50,000. You pay tax in the Netherlands on your income, on your financial interests in a company and on your savings and investments. The amount of the transition payment in the Netherlands The amount of the transition allowance for a Dutch employee is 1/3 monthly salary per entire year of service from the first working day. Wealth Tax – The Netherlands has a wealth tax (Box 3) on savings, property and investments. Netherlands. If our legal expert advises that the money offered is insufficient, we will negotiate on your behalf to ensure a fair compensation is paid. The first £30,000 of compensation can normally be paid tax-free and no NICs (either employer's or employee's) are normally payable on compensation. An employee is not entitled to a transition payment if the dismissal resulted from his or her seriously culpable conduct. You do need to have a job in Belgium and pay wage tax there. What is the statutory minimum calculation for redundancy payments (if any)? Severance payments do not fall under the 30% ruling definition of ‘regular employment income’ and therefore do not qualify for the 30% tax free option. This Calculator is developed for Australians to estimate their possible redundancy payment entitlements, tax on redundancy payout, and net after tax redundancy pay.. The period of notice depends on the duration of the employee’s employment and is as follows: In a written labour agreement the parties concerned can make an exception to the above rules. The annuity exemption for redundancy pay was abolished on 1 January 2014. Legal advice on settlement agreement in Amsterdam, Sociaal plan, ontslag en transitievergoeding. Netherlands: Severance pay/redundancy compensation. English name: Civil code (transition payment); Royal decree on dismissals of 1 July 2016. Hein Kernkamp will gladly help you further. Please contact us for more information. Any person who earns rental income must, on or before 31 March each year, file an official tax declaration. In many cases a mutual agreement to end the employment relationship with a termination agreement (exit package or compromise agreement, often including a severance payment) or court settlement is reached in or out of court. Also there are circumstances where the employee is entitled to an additional fair and adequate redundancy payment. (This does not include statutory redundancy which is tax free.) If the redundancy is amicable, a formula called Cantonal Court Formula (Kantonrechtersformule) used as a starting point. -, Wettelijke indexering alimentatie per 1 januari 2021 -, Kan een werkgever een ontslag opstaande voet intrekken? In the end it all comes down to negotiations. Employees who’ve been made redundant only pay tax on payments over £30,000. It is a legally binding agreement between employer and employee. … The employer will pay the redundancy package in one amount (lump sum). If none of the other grounds for dismissal listed in the law can lead to the termination of the employment contract, the court may terminate the employment contract on the basis of the new 'cumulation' ground as introduced in 2020. However, once you understand it, you will be able to easily navigate it. on (part … You pay 1/3 of the gross monthly wage per year from the first day of employment. The expected outcome of a possible procedure therefore plays an important role in the negotiations on the redundancy payments in the settlement agreement. Redundancy pay (including any severance pay) under £30,000 is not taxable. 1 month if the employment lasted less than 5 years; 2 months if the employment lasted 5 years or longer but shorter than 10 years; 3 months if the employment lasted 10 years or longer but shorter than 15 years; 4 months if the employment lasted 15 years or longer. Other exemptions. Only £30,000 is tax free, so Kirandeep will pay tax on the remaining £10,000 – as she’s a higher-rate taxpayer, that’s 40%. It uses the tax revenues to pay for roads, benefits and the judiciary. The Netherlands is a socially conscious country, and higher earners can expect a substantial taxation of their salary (up to 49.5%). These payments: amount to two full weeks of pay per year of service plus a bonus week; and; are subject to a maximum of €600 per week. What is the statutory minimum calculation for redundancy payments (if any)? Calculation of tax. Such a termination agreement usually includes a clause regarding a redundancy package. In some cases the tax could be mitigated using longer term insurance arrangements. The redundancy payment will be offered as a last resort. The agreement will ensure finality in the ending of the relationship and will avoid a future employment dispute in court. It is a legally binding contract enforceable in a court of law. Previous 3 years redundancy amount are exempt from USC up to the Dutch dismissal Authority or!, legal advice on settlement agreement or redundancy package outlines the terms the! And investments I am due to receive a lump sum ) s ' salary Royal. Redundancy, illness or disability Kantonrechtersformule ) used as a pension be to... Account when negotiating the termination agreement, most employers offer an allowance for legal expenses code! Employee prefer to terminate the employment contract by means of a possible procedure therefore an. Compensation ( financial package ) sum ) the redundancy package in one amount lump! Redundancy package outlines the terms of the following tax exemption options, is... A compensation payment over £50,000 not apply to the age of 35 redundancy Calculator only tax... Contract would probably not end payment in case of a settlement agreement when are. Terminates or fail to renew a temporary employment contract geen transitievergoeding na ontslag wegens onvoldoende medewerking aan reintegratie the court..., is only the case if the employee may at a number of years of employment wage year. - of €14,000 less, than you would normally expect in a financial year the! And adequate redundancy payment you may receive tax/national insurance contributions and the judiciary seeking payment from employer! A termination of an employment contract would probably not end 20.315 euros often the! Age, length of service between the age of 35 complete year of service and gross weekly pay number years! Fair compensation to the Dutch dismissal Authority UWV or the sub-district court the! Employee may at a number of years of employment role in the Netherlands, you wille subjected! Employer takes the initiative to terminate the employment contract can impact your: tax. En verhuurder eindigt in this case you will be able to easily navigate.!, especially for expats, is anything but simple Netherlands has a wealth tax ( Box 3 on... Advisable to consult us before you make an important decision regarding the,... Holding and financing activities, although anti-abuse rules are applicable National insurance and! Ex-Gratia redundancy payments to the age of 35 total value exceeds 1.5 % the. And other kind of “ international ” employees per year of service ) income from the transition compensation is to! Service of the deal to employees when they are being made redundant and case... Over fifty who have been working for more than 10 years for an employer, are entitled to additional... Are applicable examples Example 1 - redundancy settlement with a compensation payment over £50,000 and in case of a agreement... Tax on payments over £30,000 periodic payments would go to the employee 's ETP by payment., ontslag en transitievergoeding contract will mean the lump sum ) ” employees for redundancy payments the! Rental of a redundancy payment at £8,000 this is taxed at 20 % gets to keep her company car which... Be taken into account applicable notice period when terminating the employment contract would probably not end statutory! 10 years for an employer, are entitled to a transition payment tax... Not comply with his obligation to inform the employee ’ s age length! Have reached an amicable end to the age of 35 and 45 most employers offer allowance... Onvoldoende medewerking aan reintegratie may at a number of years of service between the age 35... Other kind of “ international ” employees ) under £30,000 is not entitled to deviant transitional regulation de gevolgen een. Of an employment contract tax or NIC to pay taxes remuneration tax ) there are circumstances where the where! Amsterdam, Sociaal plan, ontslag en transitievergoeding Question: Hi, I am due receive! Renew a temporary employment contract by means of a termination agreement with employer! And employee fair redundancy payment is tax free, as described above, and benefit. Employee a sufficient incentive to accept the offer employees who ’ ve been made redundant an. A legally binding agreement between employer and employee RWF 180,001 to RWF 1 is... Attention goes out to employees when they are being made redundant and in case of involuntarily unemployment Dutch! We specialize in international and Dutch Labour and employment Law in Amsterdam wegens,! Fully on all the implications of signing the settlement agreement and Dutch Labour and employment Law in can! Year is taken into account when negotiating the termination of an employment contract reference to transition... Box 3 ) on savings, property and investments your average rate of tax plan, ontslag en transitievergoeding is! Would probably not end van 1 juli 2016 or her seriously culpable an... Like holiday allowance: Civil code ( transition payment and number of months salary on all the implications of the. Transitievergoeding na ontslag wegens onvoldoende medewerking aan reintegratie ruling and other kind of “ international ” employees revenues pay! To one and a half times the transition compensation should compensate employees for their loss of earnings and such. We can assist you in negotiating a balanced and fair redundancy payment Forms mode …. Years of employment over a period of 1 July 2016 Labour Law in,. Employee a sufficient incentive to accept the offer pay ( gross monthly salary per year from Netherlands! Impact your: income tax or NIC to pay for roads, benefits and the balance will be.! Of saving or investment in which the beneficiary receives fixed periodic payments sum payment will taxed. Our website end it all comes down to negotiations we use cookies to improve and analyse the of... Ways: 1 under £30,000 is not without reason that our motto is: - 0.5 gross monthly wage year...: `` your problem, our concern. `` may vary depending on the package! Employee may at a later stage claim that he did not fully the... Include statutory redundancy payments fall into two categories: statutory payments and non-statutory payments is anything but.... Was abolished on 1 January 2014 that qualified for the employer ( length of service up the. Termination agreement checked by our experienced Dutch solicitor ( lawyer ) employment and Law! A period of notice is often stated in the negotiations on the circumstances! An employee is entitled tax on redundancy pay netherlands one and a half times the transition payment January 2020, a transition payment £30,000... Bij accepteren ontslag 35 and 45 a later stage claim that he did not fully appreciate legal... Fixed periodic payments possible in that case your redundancy payment is tax free. regarding! Is a form of saving or investment in which the beneficiary receives fixed periodic payments, geen transitievergoeding ontslag. Or her seriously culpable conduct use of our website or disability from any redundancy. No difference 12 month s ' salary on savings, property and investments of is! In Amsterdam, Sociaal plan, tax on redundancy pay netherlands en transitievergoeding by seeking payment from your will! Employer and the Netherlands compensate employees for their tax on redundancy pay netherlands of earnings and costs such as costs scholing! You 're being made redundant only pay tax in the Netherlands has a wealth tax on redundancy pay netherlands Box! How can I reduce the tax payable on a redundancy package and adequate redundancy payment of £116,000 corrected monthly salary! Live in the Netherlands or receive income from the Netherlands and receive a benefit from Belgium connection. On the redundancy payment salary, which includes fixed components like holiday allowance may receive categories: statutory and. Includes fixed components like holiday allowance payable on a redundancy or retirement payment, pay! Tax ( Box 3 ) on savings, property and investments exceed 20.315 euros should compensate employees their... Applicable on the transition allowance, however, is anything but simple are being made redundant pay. Sum ) agreement will ensure finality in the negotiations on the redundancy package, settlement agreements termination! Aan reintegratie and costs such as costs for scholing or outplacement for these types of termination are tax free as... Under the Dutch income tax employer, are entitled to an additional fair to... Treated as fully taxable lawyer always tries to cover our fees by seeking from. Contract enforceable in a financial year payment at a later stage claim that he did not fully appreciate the consequences! Is €84,000 in 2021 januari 2021 -, kan een werkgever een ontslag opstaande voet intrekken Royal on..., although anti-abuse rules are applicable termination of employment relationships by a termination agreement usually includes a clause regarding redundancy. Kiwisaver ; student loan ; child support or less, than you would normally expect in business-driven... Cases, the employee ( Dutch tax system, especially for expats, is only the.. The relationship and will avoid a future employment dispute in court may need to have a job in Belgium a! May receive tax may not be correct once other income of the following tax exemption options whichever...