Preliminary Refund

The preliminary refund is a monthly payment from the Dutch Tax Authority that gives you an advance on your expected tax refund. Instead of waiting until after your final assessment, you receive an amount in your bank account every month. This is especially useful if you are entitled to large deductions, such as mortgage interest. You apply for a preliminary refund through Mijn Belastingdienst (My Tax Authority). You fill in your expected income and deductions for the coming year, and the Tax Authority calculates how much you receive monthly. Note: if your situation changes (different income, different deductions), you must adjust the preliminary refund to avoid an additional assessment. The preliminary refund is later settled against your final assessment. If you received too much, you must repay. If you received too little, you get the difference afterwards.

Why does this matter?

The preliminary refund significantly improves your monthly cash flow, especially with a mortgage. But be careful: if your situation changes and you don't adjust the refund, you could face a substantial additional assessment. Check annually whether the amounts are still correct.