Tax
A box system for personal income, with three Box 1 brackets to 49.5%
Personal income tax under the Income Tax Act 2001 is split into three boxes: employment and home income (Box 1), substantial shareholdings (Box 2) and savings and investment (Box 3). Box 1 has three brackets rising to 49.5%, corporate tax is 19% then 25.8%, and standard VAT is 21%.
Key rules
- Box 1 rates for 2025 are 35.82%, 37.48% and 49.5%, the top rate applying above about EUR 76,800.
- Box 3 taxes a deemed return on net assets, an approach repeatedly challenged before the Supreme Court and under reform.
- Corporate income tax is 19% on the first EUR 200,000 of profit and 25.8% above it.
- Standard VAT (btw) is 21%, with a reduced 9% rate for food, medicine, books and some services.
Governing law
- Income Tax Act 2001 (Wet inkomstenbelasting 2001) (2001)
- Corporate Income Tax Act 1969 (Wet Vpb 1969) (1969)
- Turnover Tax Act 1968 (Wet OB 1968) (1968)VAT
Penalties and consequences
- Default and negligence surcharges on unpaid or understated tax
- Interest on late payment and, for fraud, criminal prosecution
In practice
Box 3 is the most contested area: the Supreme Court has held the deemed-return method incompatible with property rights in some years, prompting a phased move toward taxing actual returns. Returns are filed digitally through Mijn Belastingdienst.