Tax-free kilometre allowance increased
The tax-free kilometre allowance of € 0.21 per kilometre is increasing to € 0.23 per kilometre from 1 January 2024.
Expansion of exemption for public transport season tickets and off-peak passes
The two existing schemes under which employers can provide public transport season tickets free of tax are being replaced by a single exemption under the work-related expenses scheme. The only condition is that the employee actually uses the season ticket (to any extent) for business trips (including commuting).
End of temporary increase in fixed budget under work-related expenses scheme
The work-related expenses scheme allows you, as an employer, to grant your employees all kinds of allowances and benefits in kind free of tax. The fixed budget under the work-related expenses scheme was expanded on a one-off basis in 2023 to 3%, on a wage bill of up to € 400,000. This increase will no longer apply in 2024. For 2024 the fixed budget will amount to 1.92% up to a wage bill of € 400,000 and 1.18% on the excess amount. If you exceed this fixed budget, you have to pay 80% tax via the final levy in your payroll accounting.
This means that, if you have a wage bill of exactly € 400,000, the level of untaxed allowances and benefits in kind is falling from € 12,000 to € 7,680. Do you have eight employees who together earn € 400,000? If so, the change means that a lower untaxed allowance of € 540 per employee will be possible.
Statutory minimum hourly wage
The Netherlands has a statutory minimum wage. This takes the form of a monthly minimum wage. From 2024 it will change to an hourly minimum wage. Everyone aged 21 or above who is working for the minimum wage will therefore receive the same hourly pay. A monthly, weekly or daily wage will no longer be permitted.
Please note!
The minimum monthly wage will be converted to an hourly wage on the basis of a 36-hour working week. This means that employers will face an increase in wage costs if they have employees who are contracted to work for more than 36 hours a week for a minimum hourly wage. It is not yet known whether the government will make arrangements to compensate for this.
This change has been included in the legislative proposal on the introduction of a statutory minimum hourly wage.
Obligation for large employers to report on work-related personal mobility
From 1 January 2024 employers with more than 100 employees will have to keep a record of the CO2 emissions of their staff. This obligation is being introduced with the aim of reducing CO2 emissions by 1.5 megatonnes by 2030.
A record must be kept of all business trips made by staff; this covers commuting and all other business trips. The Netherlands Enterprise Agency (RVO) will calculate the CO2 emissions on the basis of the data submitted. Do you meet the criteria? If so, you have until 1 January 2024 at the latest to adapt your records accordingly.
For the time being, there is only an obligation to report this data. From 2026 additional regulations may apply if it appears that your employees are collectively emitting too much CO2. This reporting obligation is part of the ‘Decree on the reduction of CO2 emissions from work-related personal mobility, a measure included in the Climate Agreement.
As an employer you will need data including the following:
- The total number of kilometres travelled by your employees in a calendar year for business trips and commuting.
- An annual total of kilometres travelled broken down by mode of transport and fuel type.
You will submit the data requested to the RVO using a digital form. The CO2 calculation will also be performed via this digital form. The report for 2024 will need to be submitted by 30 June 2025 at the latest. For the digital form you will need at least eHerkenning level eH2+ with authorisation for RVO services.
Please note!
Take action promptly to comply with your reporting obligation.
Capping of 30% scheme at ‘Balkenende standard’
With effect from 1 January 2024 it will be possible to apply the 30% scheme up to an income level not exceeding that laid down in the Standardisation of Top Incomes Act (known as the ‘WNT standard’ or ‘Balkenende standard’). Employees who come to the Netherlands and meet the criteria are entitled to make use of the 30% scheme. This means they can receive up to 30% of their salary free of tax. As a result of the measure being taken, it will be possible to apply the 30% scheme up to a salary of € 223,000 (2023). For expats who were already taking advantage of this scheme in 2022 there will be no salary ceiling for application of the 30% scheme up to 31 December 2025.
‘Older workers’ target group scrapped under wage expense allowance
The wage expense allowance (LKV) is an allowance for employers who take on one or more employees from target groups that often have difficulty finding work. The LKV for older workers is expected to be scrapped from 2026.
Low-income allowance (LIV) reduced
The upper limit of the hourly wage criterion for the low-income allowance (LIV) is being reduced from 125% to 104% of the statutory minimum wage.
Enforcement of law relating to bogus self-employment
On 1 January 2016 the Assessment of Employment Relationships (Deregulation) Act (Wet DBA) was introduced. In principle, this Act is not being enforced for the time being, but this is set to change. From 1 January 2025 the Tax and Customs Administration will start enforcing the law on bogus self-employment again. Bogus self-employment applies if, in practice, a self-employed person is actually in a disguised employment relationship with a client.
Please note!
The model agreement based on ‘free replacement’ is being withdrawn from 1 January 2024.
Please note!
Enforcement is already possible in situations where parties have acted in bad faith or an instruction to take action has been issued.
STAP budget to be abolished
The STAP budget (learning and development budget intended to enhance a person’s labour market position) will be abolished from 1 January 2024. This is a subsidy of up to € 1,000 to follow a training programme or course.
Increase in higher-rate contribution to Invalidity Insurance Fund (Aof)
The Aof contribution is a compulsory payroll tax that you, as an employer, pay to the Invalidity Insurance Fund. A differentiated Aof contribution has applied since 1 January 2022. There is a lower contribution for small employers and a higher contribution for medium-sized and large employers. The higher Aof rate is being increased by 0.09%.
