Income tax and social security
01 Jun 2010
If you have a part-time job next to your studies, you will find that your net salary will be quite a bit lower than your gross salary. This is because your income is subject to income tax and social security contributions.
Social security
Social security contributions will be deducted from your gross pay. These deductions support the systems that provide disability pay and unemployment benefits – meaning that, as an employee, you will be insured against the consequences of any work-related accident.
Your employer is obliged to deduct these social security contributions from your pay before you receive it. The deductions can easily take up a third of your gross pay. Your employer’s human resources department can provide a detailed explanation of this and other elements of your payslip.
Please also note that if you are covered under Dutch social security, you must also take out Dutch public health insurance. Read more about this in our section on health insurance.
Income tax
Each year, you have to pay tax over your total Dutch income in that year. Income tax is deducted from your wages on a monthly basis.
Please bear in mind that scholarships may also be seen as income and might be added to the total. This means that, if you have a scholarship that is taxed as well as a part-time job, in the worst-case scenario you may receive less money than if you would only have a scholarship.
According to Dutch law, a person is only obliged to pay income tax in one country. This means that if you receive a scholarship from abroad and your country has signed a tax treaty with the Netherlands, it is possible that your scholarship will not be taxed in the Netherlands.
The Netherlands has tax treaties with many countries, including all EU member states. For more information about this complex issue, we advise you contact your employer’s human resources department. Alternatively, you could phone the Tax & Customs Administration Office (Belastingdienst) on 0800 0543.
Paid internships
If you are a foreign student doing an internship in the Netherlands, you are exempted from paying Dutch income tax if all of the following criteria apply to your situation:
- You will be staying in the Netherlands no longer than six months.
- You are doing an internship (work placement) for educational purposes only.
- Your allowance is intended to compensate only your expenses.