Income Tax
Income tax (inkomstenbelasting) is the tax you pay as an individual on your income. In the Netherlands, this is divided into three boxes: box 1 (work and home), box 2 (substantial interest), and box 3 (savings and investments). Each box has its own rates and rules. You file your income tax return by completing your declaration, usually via Mijn Belastingdienst (the tax authority's online portal). The deadline is May 1 of the year following the tax year. So for tax year 2024, you must file before May 1, 2025. If you can't make it, you can request an extension.
Example
Jan earns a €45,000 salary (box 1), has no shares in a BV (box 2 = €0), and has €30,000 in savings (box 3 = below the exemption). His income tax is therefore only calculated on box 1. After deducting tax credits, he effectively pays around €9,500 in tax.
Why does this matter?
Income tax affects everyone who lives or works in the Netherlands. By carefully completing your return and claiming all deductions and credits, you can save hundreds to thousands of euros. Remember: the tax authorities won't send you a bill for missed deductions.