The 30% ruling for Americans: who qualifies, the 2026 salary test and the drop to 27%

If your employer recruited you from the States, the Dutch expat scheme can make up to 30% of your pay tax-free in the Netherlands, but the maximum falls to 27% from 2027 and the IRS doesn't follow the Dutch rules.

The short version

• What it is: the 30%-regeling, now officially the Expat Scheme, lets your employer pay up to 30% of your salary as an untaxed allowance for the extra costs of living abroad [1].
• The 2026 salary test: taxable salary above EUR 48,013 (about USD 53,600), or EUR 36,497 (about USD 40,700) if you're under 30 with a qualifying master's degree [1].
• The distance rule: you must have lived more than 150 km (93 miles) from the Dutch border for more than 16 of the 24 months before you start. Living in the US clears that easily [1].
• It lasts up to five years, minus earlier time you lived or worked in the Netherlands [1].
• From January 1, 2027, the maximum drops to 27% for most people, with transition rules based on when you first qualified [2][3].

USD conversions in this guide use the Federal Reserve H.10 rate of October 30, 2026 (USD 1.1163 per euro).

How the ruling works

Back home, a relocation package is mostly a moving allowance and maybe a few months of corporate housing. The Dutch go further. Under the Expat Scheme, your employer can pay part of your package as a tax-free allowance for "extraterritorial costs," the extra costs of living outside your home country. Instead of proving each cost, the scheme lets the employer pay up to a fixed percentage of your salary untaxed [1].

In practice, most employers restructure your gross salary so that 70% is taxed as normal wages and up to 30% is paid tax-free. The allowance is a maximum, not a guarantee. Your employer may pay less, and you should agree the amount in advance [1].

There's also a cap. For 2026, the maximum tax-free allowance is EUR 78,600 (about USD 87,700), which you reach at a salary of EUR 262,000 (about USD 292,500) for a full year. It's prorated for part of a year [1].

Who qualifies in 2026

The Belastingdienst (the Dutch tax administration) lists these conditions [1]:

1. You're in paid employment with a Dutch employer, or one that withholds Dutch payroll tax.
2. You have specific expertise that's scarce in the Dutch labor market. In practice, that's tested by salary. Your taxable salary, not counting the tax-free allowance, must be above the threshold:

Scientific researchers at designated institutions and doctors training as specialists have no salary threshold [1]. 3. You were recruited from abroad, and for more than 16 of the 24 months before your first workday you lived more than 150 km (93 miles), as the crow flies, from the Dutch border [1]. 4. You and your employer have a decision from the Belastingdienst approving the scheme [1].

The 2027 thresholds come from the legislation that set up the 27% rate. They were written in 2024 terms and are indexed each year, so the actual 2027 amounts will be higher [3].

The 150 km (93 mile) rule for Americans

For anyone moving straight from the US, the distance test is a no-brainer. It gets trickier if you've been living somewhere closer first. Time in Belgium, Luxembourg or parts of Germany, France or the UK near the border doesn't count as far enough away [1]. If you moved from Boston to a job in Brussels and then on to Amsterdam a year later, you may not qualify. There's an exception if you used the scheme for an earlier Dutch job that started no more than five years ago [1].

The five-year clock

A decision lasts up to five years, and the end date is printed on it. Earlier periods when you lived or worked in the Netherlands are deducted, unless they ended more than 25 years ago or were very short, such as fewer than 20 working days a year or short personal visits [1]. A semester abroad at the University of Amsterdam a decade ago could shave months off your ruling.

The change to 27% from 2027

This is where you may see outdated advice online. A law passed in 2023 was going to step the percentage down to 30%, then 20%, then 10% over the five years for people starting from 2024. That phase-down was reversed before it ever bit: an amendment to the 2025 Tax Plan replaced it with a single 30% maximum for 2025 and 2026 and a maximum of 27% from January 1, 2027 [2][3].

The transition rules depend on when you first qualified [3]:

The Belastingdienst's English page still speaks of up to 30%, which is correct for 2026 [1]. If your ruling continues into 2027, check with your payroll team that they've applied the right percentage, and that your taxable salary still clears the higher 2027 threshold.

Partial non-resident status is going away

Older guides mention a second perk: electing to be treated as a non-resident for Box 2 and Box 3, which kept your savings and investments out of Dutch wealth-return tax. That option can no longer be chosen from the 2025 tax return. If you used the scheme before 2024, you can keep it through the 2026 tax return [1]. Our Box 3 guide explains what that means for your US brokerage account.

Applying and changing jobs

Your employer applies for the decision, together with you, using the Belastingdienst's request form. Most international employers in Amsterdam do this routinely, but ask HR in writing before you sign, and get the percentage and how your gross salary is split into your contract.

If you change jobs within the same corporate group, the decision stays valid. If you move to an unrelated employer, the ruling can continue only if you start the new job within three months of leaving the old one, and the new employer applies within four months of your start date [1].

How the ruling fits with your US taxes

Uncle Sam still wants your return, and he doesn't care about Dutch tax-free labels. The US taxes citizens on worldwide income, and an allowance paid to you by your employer is generally part of your compensation for US purposes, even if the Netherlands doesn't tax it. Here's how the two systems usually meet:

• Foreign earned income exclusion (FEIE). On Form 2555 you can exclude up to USD 130,000 of foreign earned income for tax year 2025 and USD 132,900 for 2026, if you pass the bona fide residence or physical presence test [4][5]. The ruling allowance counts toward that cap.
• Foreign tax credit (FTC). Dutch income tax rates are high, so many Americans in Amsterdam get more from Form 1116 credits than from the exclusion. The 30% ruling lowers your Dutch tax, which means fewer Dutch taxes to credit against US tax on the same income. For some higher earners, that can leave a small US tax bill that wouldn't exist without the ruling.
• Housing exclusion. If you use the FEIE, the housing cost amount starts from a base of USD 39,870 for 2026, adjusted by location [5].

Which mix works best depends on your salary, family and other income, and it can change in the year the ruling ends. A US expat tax preparer can check your situation. Also keep filing your FBAR for Dutch accounts, and see our guide to the FEIE vs the foreign tax credit.

Comparing offers or negotiating a package? Other Americans share what their employers did with the ruling in our community group for Americans in the Netherlands.

Sources

1. Expat Scheme (30% facility): conditions and amounts, Belastingdienst
2. From a 30% ruling to a 27% ruling, Loyens & Loeff (November 2024)
3. 2027: the year of the 27% ruling, BDO Netherlands
4. Foreign earned income exclusion, IRS
5. Figuring the foreign earned income exclusion, IRS
6. 30 percent ruling compensation down to 27 percent, Business.gov.nl

Keep reading

• Netherlands taxes for Americans
• Box 3: the Dutch tax on savings and investments
• Foreign earned income exclusion vs foreign tax credit
• Filing a US tax return from abroad