Tax information for students

There are various types of taxes in the Netherlands, categorized in “boxes”. One of these is income tax, belonging to box 1. Income tax is the tax taken out of your paycheck, and it is the most relevant tax type for students. Income tax in the Netherlands increases with your income. This is called progressive tax rate, and the incomes and tax percentage are outlined below.

Tax Brackets

• Box 1: Income from work and home.
• Progressive tax rate (0-€73,031/year): 36.97%
• Progressive tax rate (€73,031+): 49.5% 

Besides your income, there is another crucial aspect which determines how income tax is applied to you. This distinction is whether you work for an employer or if you are self-employed (freelancer).

1. Working for an Employer

When you work for an employer, they handle your income tax. This means that you do not need to do anything about your income tax. However, you can file a tax report, which will likely result in you receiving some money since employers often withhold too much tax. 

2. Freelancing

If you are a freelancer, you must handle your own income tax. For example, an Uber Eats delivery driver is a freelancer and must handle their own tax. Failure to do so can result in significant fines. The procedure for filing your own income tax for freelancers is overly complex and lengthy to be put within this article. What is important to remember, is that being a freelancer comes with significant income tax obligations!

3. Filing Your Own Taxes

Filing your taxes is done online through the Mijn Belastingdienst website. When working for an employer, this is not necessary to do. However, filing a tax report will likely result in receiving money back in case you have been working. The procedure for this type of tax report is extremely simple. The government already has the information about your income, you only need to confirm it. In case of self-employement, filing your own income tax is mandatory. In addition, the procedure for a freelancer is significantly more complex.

4. Non-Resident Taxpayers

If you are not living in the Netherlands but receive income from a Dutch source, you must pay taxes as a non-residential taxpayer. For more information, consult this information on the Belastingdienst website.

• Annual Notification: Every February, you will receive a letter asking you to submit your tax declaration. If you do not receive it, it might mean you do not need to file taxes due to low income or working for an employer. However, it is advisable to always file your tax declaration, as it does not take much time and you might get money back if you have been working. You can file your tax starting from 1st of March until May 1st.
• Online Filing: Submit your declaration online via Mijn Belastingdienst. If unsure, you can do a test declaration to see if you need to file. You will need your BSN and DigiD. For more information, visit Business.gov.nl.
• Scholarships: If you receive a scholarship, include it in your tax declaration, as most scholarships are considered taxable income.