Dutch Income Tax Explained: Box 1, Box 3, and What the 30% Ruling Doesn't Cover

By Paulo Horta · Published July 2026 · 10 min read

Most of what gets written about Dutch tax for expats starts and ends with the 30% ruling, and understandably so — it's the single biggest lever most newcomers can pull. But it only touches salary income, and the Netherlands taxes life in three separate "boxes" that don't talk to each other. If you've got savings, a portfolio, or a second income stream, the 30% ruling isn't the whole story, and the parts it doesn't cover are changing quite a bit right now.

Box 1: Employment and Home Ownership

Box 1 covers salary, self-employment profit, and the notional income from owning your home (eigenwoningforfait, offset against mortgage interest relief). For 2026, it's a three-bracket system, and the first bracket already bundles in your national insurance contributions — which is why it looks steeper than the headline rate suggests.

Notice that the top rate kicks in well before it would in, say, the UK or the US — 49.5% applies from roughly €78,400, not from some six-figure threshold. That's the real reason the 30% ruling matters so much here: shielding 30% of a €90,000 salary from tax doesn't just save a bit at the margin, it pulls a meaningful chunk of income out of that 49.5% bracket entirely. Run the numbers for your own salary on our Amsterdam salary calculator, or see the ruling itself explained in full in our 30% ruling guide.

Box 3: The Wealth Tax Nobody Warns You About

This is the one that catches people off guard, because nothing quite like it exists in the UK, US, or most of the countries this site covers. Box 3 taxes your savings and investments — bank balances, shares, a second property — not on what they actually earned you, but on a deemed return the government assumes you made, currently 7.78%, taxed at 36% (an effective rate of about 2.8% of the asset's value per year). Everyone gets an exemption of €57,000 (€114,000 for a couple filing together) before any of this applies.

In plain terms: if your savings sat in a low-interest account earning 2% last year, Box 3 still assumes you earned closer to 7.78% and taxes you on that fiction. This is exactly the arrangement the Dutch Supreme Court ruled discriminatory back in 2022, and the system has been patched rather than replaced ever since. A genuine fix — taxing actual realised gains and income instead of a deemed return — passed the House of Representatives in February 2026 and is currently being debated in the Senate, with a target start date of 2028. Until then, the deemed-return system stays in force, so don't assume the rules you read about today will still apply in two years.

Box 2: If You Own Part of a Company

Box 2 applies to substantial shareholdings — broadly, if you and your partner own 5% or more of a company's shares, typically your own BV (private limited company). It's a narrower box that mostly concerns founders and directors paying themselves through dividends rather than salary, and it's worth flagging to an accountant early if you're setting up a Dutch company rather than joining one as an employee.

Worked Example: €65,000 Salary Plus €80,000 in Savings

Take a professional in Amsterdam earning €65,000 (no 30% ruling) with €80,000 in a savings account. The salary is taxed entirely under Box 1, landing in the 37.56% bracket for most of it. Separately, €80,000 minus the €57,000 exemption leaves €23,000 exposed to Box 3 — taxed at the effective ~2.8% rate, or roughly €640 for the year, regardless of what that savings account actually paid in interest. Two completely separate calculations, two completely separate boxes, and most people only ever budget for the first one.

See the Box 1 portion calculated precisely on our Amsterdam take-home pay calculator, and factor Box 3 in separately when budgeting savings goals.

What This Means in Practice

• Large cash savings aren't "safe" from tax here the way they might feel elsewhere — above the exemption, Box 3 applies whether the money grew or not.
• The 30% ruling only ever touches Box 1. Moving savings or investments to the Netherlands doesn't get any special expat treatment under Box 3.
• Watch the 2028 reform. If it goes ahead as planned, the calculation changes from a deemed return to your actual gains — better for people holding cash or bonds, potentially worse for those with strongly appreciating portfolios.

This article is general information, not tax advice. Box 3 in particular is under active legislative reform — confirm the current rules with a Dutch tax adviser (belastingadviseur) before making savings or investment decisions.