Tax residency and different kinds of tax returns

From a fiscal point of view, it all starts with tax residency which is to be determined on the basis of facts and circumstances. A resident taxpayer of the Netherlands is (usually) taxed on the basis of worldwide income. In certain situations another country may also tax. In such a situation, double taxation relief may be applicable - depending on the applicable Tax Treaty.

A non-resident taxpayer of the Netherlands is (usually) just taxed on Dutch sources of income, if the Netherlands has the right to levy tax on the basis of the applicable Tax Treaty.

In a year of entry or departure, you are considered a non-resident in the part of the year that you lived abroad and a resident taxpayer for the period that you lived in the Netherlands.

You can file a Dutch income tax return if you have any Dutch source income. In the Netherlands, there are different types of income tax returns:

• tax return “P” for resident taxpayers, 
• tax return “C” for non-resident taxpayers and 
• tax return “M” for taxpayers in migration years. 

Apart from these, there is an extended one for entrepreneurs tax return “W” and one in which income can be reported of a diseased person – tax return “F” 

A Dutch income tax return can only be prepared and filed after the concerning tax (calendar) year ended. In the past few years, the Dutch tax authorities had their software up and running to receive income tax returns as per March 1 of the year following to the concerning tax year. 


Filing requirement

Tax return filing in the Netherlands is only an obligation if you are invited to file a tax return and/or if the result of the return would be an amount payable exceeding the threshold for tax assessments of EUR 56 (threshold for 2024 differs slightly per year). 

If you are not invited to file a return (blue envelope) and the result is under EUR 48 payable, you are not required to file an income tax return. In some situations however (deductible items, migration years) it may be beneficial to file an income return.
 

Deadlines

Deadline for income tax return filing: the normal deadline for filing of an income tax return is May 1 of the year following to the concerning tax year. In case you are invited to file a return, the filing deadline is mentioned in the letter. If a tax consultant is involved, extension for filing can usually be applied for, which will extend the normal filing deadline of May 1 with 1 year. If you were not invited to file, you can still file an income tax return up to exactly 5 years from 31 december of the concerning tax year.

Deadline for a letter of objection against a tax assessment: if the Dutch tax authorities issue a final income tax assessment that is not correct, you can object to the assessment. Objection needs to be filed within 6 weeks from the issue date of the assessment (mentioned in the assessment). The Dutch tax authorities are obliged to take the objection into consideratioon. After this 6 week period you can file a request to adjust the assessment to the Dutch tax authorities. The Dutch tax authorities can still consider such a request, but they formally do not have to act after the 6 week period expired. 

Tax assessments

The Dutch tax authorities issue preliminary tax assessments and final tax assessments in the following situations:

A preliminary income tax assessment (“Voorlopige Aanslag inkomstenbelasting/premies volksverzekeringen”) can be expected: 

• after filing an income tax return (often), usually within 3 months after filing date
• after filing a preliminary tax return (optional - if you expect a refund or a payable amount, you can have the (estimated) finances settled up front, during the year)
• if you received a preliminary assessment (up front settlement) in the previous year
• if the result of your previous year’s tax returns has been a payable amount

A final income tax assessment (“Aanslag inkomstenbelasting/premies volksverzekeringen”) can be expected:

• after filing an income tax return, once the Dutch tax authorities audited/approved the return. With the final assessment, the tax year is closed. Usually the final assessment is issued within a year after filing, but sometimes the Dutch tax authorities take more time. In a normal situation, the Dutch tax authorities formally may take 3 years to finalize the tax year. 

If the preliminary assessment was in accordance with the income tax return filed, the final assessment should amount to nil. If the preliminary amount paid or refunded up front differs from the result of the income tax return, the difference is usually settled when the final tax assessment is issued.

Note that sometimes after filing an income tax return a final tax assessment is issued without preliminary assessment was issued.

Assessment for Health Care Act contribution (“Aanslag ZVW”) can be expected:

If you earned income in the period of Dutch residency, which is not processed through a Dutch payroll. Health Care Act contributions will be due on top of the income tax. A separate (preliminary) assessment may be issued in that respect.