If you live outside the Netherlands and receive a pension, the Netherlands automatically withholds tax. The good news is that you can request an exemption so you pay tax in your country of residence instead of the Netherlands.
The Netherlands Automatically Withholds Tax
Yes, the Netherlands automatically withholds tax on your AOW and occupational pension if you live outside the Netherlands. This is not optional - it happens automatically.
Why Does the Netherlands Withhold This?
The Netherlands withholds tax because you live outside the Netherlands and are no longer in the Dutch tax system. It is also a way to prevent fraud and non-payment of taxes.
How Do You Request an Exemption?
Step 1: Check If You Are Entitled to an Exemption
You may be entitled to an exemption if you live in a country with which the Netherlands has a tax treaty, you pay tax on your pension in that country, and the tax treaty determines that you only have to pay tax in your country of residence.
Step 2: Download the Form
Download the form from www.belastingdienst.nl. This form is free and available in Dutch and English.
Step 3: Fill in the Form
Your BSN (Citizen Service Number), Proof that you are a tax resident of your country of residence, Copy of the tax treaty (optional, but helpful)
Step 4: Send the Form to the Tax Authority
Send the completed form to the Dutch Tax Authority (Belastingdienst). You can do this by mail or digitally through their website.
Step 5: Receive Your Exemption Certificate
The Tax Authority will review your application. If you are entitled to an exemption, you will receive an exemption certificate.
Step 6: Send the Certificate to Your Pension Fund and SVB
Once you have your exemption certificate, send it to your pension fund and the SVB (Social Insurance Bank). They will then stop withholding income tax.
Result: Withholding usually stops within 1-2 months. You pay tax directly in your country of residence through your tax return.
What Happens to the Withheld Tax?
Tax that has already been withheld
You can claim this back through your tax return in your country of residence, or you can file a refund request with the Dutch Tax Authority.
Future
Once you have an exemption, no more tax will be withheld. You pay tax directly in your country of residence through your tax return.
Important to Know
- You must take the initiative yourself - the Netherlands will not do this automatically
- Withheld tax can possibly be reclaimed through your tax return
- Not all countries have a tax treaty with the Netherlands
- Premiums may sometimes not be exempted
- You may still have to pay a contribution for health insurance
Next Step
Now that you know how taxation works and how you can request an exemption, it is important to arrange this shortly after leaving the Netherlands. Contact our advisory firm if you need help.