Netherlands to usher in 50 new laws in 2017; End to tuition tax credits, Boost to minimum wage
The Netherlands is implementing a total of 50 changes to Dutch law as of January 1st, 2017. These changes affect everything from the minimum wage and what is covered in the basic health insurance package to the amount in mortgage you can borrow when buying a house.
The Dutch government published their annual roundup of law changes in the week before Christmas, broken down into nine categories. Find the summary below.
Education and Training (1)
Tuition no longer tax deductible
If you pay tax and receive study financing, bear in mind that since the 2015/2016 academic year, tuition is no longer tax deductible. Keep this in mind when doing your tax return for 2016.
Underage vocational students will also get a travel product next year. Information on that can be found under the Family section below.
Increase in child budget
In 2017 the maximum amount for the first child is increasing to 1,142 euros, compared to 1,038 euros in 2016. the maximum amount for the second child increases from 795 euros in 2016 to 898 euros in 2017. Families with two children living on a low to medium income can receive up to 2,040 euros in 2017. Those with more than 2 children will receive 285 euros extra. The conditions attached to these allowances can be read here.
Increase in childcare allowance
In 2017 the childcare allowance is increasing. The higher amount was paid for the first time on December 20th, 2016 as the Tax Authorities pays it in advance. Amounts can be checked on the child care allowance table here.
Student travel product for minor vocational students
From 2017 vocational students under the age of 18 can qualify for a student travel product. More information can be found here.
There are also changes to the alimony and child support amounts, and child support is no longer considered a debt in box 3. More details can be found below under the Work and Income section.
Health and healthcare (7)
Changes to basic health insurance package and deductibles
The basic healthcare insurance package is being extended to include procedures such as an operation to the upper eyelid if your sight is massively impaired by a limp or paralyzed lid, breast enlargement for women and trans women who have no breast growth and medically necessary circumcision. The full list of expanded procedures can be found here. Own risk deductibles are not increasing and remains at 385 euros.
Decrease in income-related contribution to the Health Insurance Act
The income-related contribution to the health insurance act is decreasing from 6.75 percent to 6.65 percent for employees, and from 5.5 percent to 5.4 percent for freelancers, entrepreneurs and pensioners.
Increase in care allowance
The maximum care allowance for single people is increasing by 68 euros to 1066 euros. The maximum healthcare allowance for partners is increasing by 138 euros to 2,043 euros.
Compensation for home modification for long-term care
If you have an indicator for long term care at home, you my be eligible for compensation for specially adapted housing. To find out more, contact your municipality.
Household help for long-term care (*)
If you have different care providers helping you at home based on the Long-term Car Act, domestic help at home also falls under this law from January 1st, 2017. This service no longer needs to be requested from the municipality. More information can be found here.
Right to information about incidents in healthcare (*)
From January 1st, healthcare providers must always inform their patient if something went wrong during care. The incident must also be included in your patient file. This applies, for example, to something happening in surgery that has significant consequences for the patient. Patients can use this information as support in complaints about a doctor or care provider. More information on patient rights can be found here.
Better and faster handling of complaints about healthcare providers (*)
From January 1st, 2017 all healthcare providers must employ a complaints officer. This complaints officer will help patients who can't sort out a complaint with the caregiver in question or do not know how to address a problem. Should the complaints officer also be unable to help, patients can from January 1st turn to a body specifically for dispute resolution. Each care provider must be connected to a dispute resolution body by January 1st. This body's decisions are binding and it can award damages up to 25 thousand euros. More information on the procedure to follow with complaints about healthcare providers can be found here.
Work and Income (9)
Increasing minimum wage
Minimum wage is increasing next year. As of 2017, the minimum monthly wage for a person 23 years old and older is 1,551.60 euros, compared to 1,537.20 euros in 2016. The amounts for younger persons and more information can be found here.
Increase in once-off gift tax exemption for personal property
The maximum untaxed gift amount for an own home increases to 100 thousand euros. It does not matter whether the gift comes from a parent or another third party. The recipient must be between the age of 18 and 40 years and must use the money to buy a home or remodel it. More information can be found here.
Changes in tax calculations
From 2017 taxes on your savings and investments will be calculated in three tiers, instead of just a percentage of the amount you have in savings and investments. The first tier is up to 75 thousand euros, 2nd tier is between 75 thousand and 975 thousand and third tier is 975 thousand euros or higher. The calculation method can be found here. The tax free assets amount is also increasing to 25 thousand euros per person, up from 24,437 euros.
Increase in financial compensation for dismissal, so-called transition allowance
The transition allowance is increasing to a maximum of 77 thousand euros gross. Or up to a gross annual salary if this figure is more than 77 thousand euros. In 2016 the amount was 76 thousand euros. More information can be found here.
Child support no longer considered debt in box 3
From 2017 the cost of child support must no longer be given up as debt in box 3.
Annual alimony increase
Each year the amounts for child support and alimony are adjusted by a certain percent increase. This is called indexing of alimony. The index for 2017 is 2.1 percent, compared to 1.3 percent in 2016. More information can be found here.
Measures against sham constructions
From 2017 employers must pay the full minimum wage. Constructions in which employers pay less than the minimum wage are illegal. This includes, for example, constructions in which meal costs or insurance premiums are deducted from wages before they are paid. More information can be found here.
More wealth allowed on welfare benefits
From 2017, people on welfare benefits are allowed a higher amount in personal wealth, such as savings, before it affects their benefits. More information can be found here.
Increase in unemployment benefit for the elderly
The amount paid for elderly unemployment benefits (IOAW and IOAZ) is increasing in 2017. You may apply for one of these benefits if you are 50 years or older and unemployed. Amounts and conditions can be found here.
Traffic and Transport (4)
Changes to additional tax paid on company car (*)
If you drive over 500 private kilometers per year in a company car you are charged additional tax on the catalog value of the car. This rate is changing in 2017. For new cars with CO2 emissions of 106 grams per kilometer or more, the new additional tax rate is 22 percent. Fully electric cars remain at 4 percent. New plug-ins will be charged at 22 percent. More information can be found here.
Decrease in motor vehicle tax
As of January 1st, 2017, the motor vehicle tax for regular passenger vehicles will be reduced by an average of 2 percent. Plug-ins will benefit from a half rate in 2017. More information about motor vehicle tax can be found here.
Speed-pedelec gets scooter license plate
From 2017 all speed pedelecs - high speed e-bikes - must be equipped with a scooter license plate. You have until July 1st, 2017 to equip your speed pedelec with the proper yellow license plate. If you buy such an e-bike after January 1st, it will automatically be equipped with the right plate.
Costs for driving ability examination
From 2017 you will partly or completely pay for a mandatory driving ability examination yourself. How much you pay depends on the reason for the examination. You wil pay the whole amount if you committed two serious offenses that suggest medical unfitness or inadequate driving skills. You will also pay the full amount if you had to visit the CBR twice for educational measure on your behavior - a course where you are taught to participate in traffic safely. In other cases you pay only part of the cost.
Underage vocational students will also get a travel product next year. Information on that can be found under the Family section above.
Housing and Environment (11)
Rent increase (*)
Social housing rent may increase by up to 2.8 percent in 2017. In 2017 there is also only one income limit for income related rent increases. That is 49,349 euros. For this income rent may increase by up to 4.3 percent. Chronically ill and disabled people will remain excluded from income-related rent increase. From 2017 households of four or more people and households with one or more people over the retirement age will also be excluded from income-related rent increase. More information can be found here.
Subsidy for energy saving homes (*)
From January 1st you can apply for a subsidy to install energy saving measures in your home or apartment. You can apply for this subsidy from the national service for entrepreneurial Netherlands RVO. More information can be found here.
Decrease in maximum height of mortgages
From 2017 you can only get up to 101 percent of the value of your home as a mortgage. In 2016 it was 102 percent. More information can be found here.
Modification to mortgage deduction in 4th bracket
The maximum mortgage deduction in the highest tax bracket is decreasing by half a percent annually. In 2017 the maximum tax rate at which mortgage interest can be deducted is decreasing from 50.5 percent in 2017 to 50.0 percent.
Higher mortgage for double income households (*)
From 2017 two-income households will be able to borrow more money to buy a house. When calculating the maximum mortgage amount, the second income will count for up to 60 percent. More information can be found here.
Increase in energy tax
Energy tax is increasing in 2017. The tax rates for natural gas and electricity can be found here.
Launch of a buy-out scheme for properties under a high voltage line
On January 1st a buyout scheme fo properties under a power line is launching. Owners can sell their property to the municipality if the property meets the conditions of the scheme. The scheme will run until December 31st, 2021. More information can be found here.
Conservation Act replaces three other laws
On January 1st, 2017 the new conservation act takes effect. This Act replaces three laws - the 1998 nature Conservation Act, the Forestry Act and the Flora and Fauna Act. The new Act simplifies the rules for the protection of wild animals and plants, Natura 2000 areas and forests. More information on the Conservation Act can be found here.
Police may now test violent perpetrators for alcohol and drug use
From 2017, the Dutch police may test whether a violent offender used alcohol or drugs. This starts in January with testing in a number of launch areas. The police will initially only test for the use of alcohol. The expectation is that testing for both alcohol and drugs in violent crimes will happen nationwide by July 2017. Violent perpetrators under the influence of alcohol and drugs may face a higher sentence. More information can be found here.
Lapse of automatic housing priority for refugees (*)
The automatic priority for refugees - asylum seekers with a residency permit - in the allocation for rental housing expires as of April 1st, 2017. From then municipalities can decide for themselves whether it is necessary for refugees to be given priority over other house hunters. More information can be found here.
Increase in rent allowance (*)
The rent allowance is increasing to 10.50 euros per month for almost everyone. More information can be found here.
The maximum untaxed amount for a gift or donation towards an own home is increasing in 2017. More information can be found under the Work and Income section.
Increase in state retirement age
From January 1st, 2017 the state pension age is 65 years and 9 months, compared to 65 years and 6 months in 2016. More information can be found here.
There is also an increase in elderly unemployment benefits IOAW and IOAZ. Find more information on that under the Work and Income section.
Compensation for telephony, television or internet failures
From July 1st, 2017 you are entitled to compensation for telephony, television or internet outages lasting longer than 12 minutes. You will get a refund of a proportion of your monthly subscription fees. This applies to both individual consumers and business customers. More information can be found here.
Energy tax is increasing in 2017. More information can be found under the Housing and Environment section.
Entrepreneurs and Businesses (13)
E-invoice to government mandatory
From January 1st, 2017 all suppliers to the central government are required to send e-invoices with new purchasing agreements. This can be done in different ways including through an accounting program with Simplerinvoicing, through a connection on Digipoort or through the State's supplier portal. More information can be found here.
Mandatory digital delivery of annual accounts
From January 1st, small businesses are required to deliver their financial statements digitally to the Chamber of Commerce. That must be done through the Standard Business Reporting.
Lower legal wages for startup directors and shareholders
As of January 1st, 2017, directors and major shareholders of startups are no longer required to give themselves a taxable salary of 44 thousand euros. During the first three years of their business, they may pay themselves minimum wages so that there is money left over to invest in the company.
Additional funding scheme for research and development
Companies who want to innovate and grow, can be reimbursed for a portion of their labor costs through the WBSO scheme. Next year more money will be available for research and development through this scheme. The budget for the WBSO scheme in 2017 is 1,205 million euros. More information on the scheme can be found here.
Low-income benefit for employers
From January 1st employers can be compensated for hiring long-term unemployed or people with occupational disabilities. Mor information on this low-income benefit can be found here.
No-risk policy now valid indefinitely
From 2017 the no-risk policy is valid indefinitely, instead of only for five years. The no-risk policy means that employers don't have to pay the price if their occupationally disabled employee falls sick. More information can be found here.
Increase in Starters Credit
In 2017 the maximum starters credit is increasing to 35,677 euros, from 35,549 euros in 2016. More information on borrowing starting capital can be found here.
Increase in amount of capital that can be borrowed
Depending on your individual situation, you may be able to borrow more working capital, or receive it as a gift, in 2017. Amounts and conditions can be found here.
More capital allowed on business benefits (bbz benefits)
In 2017 you as an independent contractor or self-employed on welfare are allowed a capital of 186,498 euros before it affects your benefit. In 2016 the maximum amount was 185,829. The conditions for this self-employed benefit can be found here.
Foreign shareholders may recover dividend tax
From 2017 it is possible for foreigners with shares in Dutch companies to reclaim excesses in Dutch dividend tax.
Research and Development tax benefits
Businesses who spend on research and development in another part of the business group, and make profit from it - this profit is no longer eligible for tax benefits.
Broadening of the definition for building site for VAT purposes
If you have bought land and want to build there, this will now be classified as a building site for VAT purposes in 2017. When buying a building site you pay 21 percent VAT and are exempt from transfer tax. If you buy land not for the purposes of building, you pay 6 percent transfer tax and have are exempt of VAT.
Increase in waste tax
From January 1st, 2017, tax on waste will be 13.11 euros per 1,000 kg of waste, compared to 13.07 euros in 2016. This rate applies to companies that incinerate or dump waste in a landfill. Waste tax does not apply if the company recycles the waste.
The IOAZ benefit for elderly entrepreneurs is increasing in 2017. Information on that can be found under the Work and Income section above.