US Citizens Working in Netherlands
See what you actually take home after US and Netherlands taxes — whether you're already working abroad or planning a move.
Here's what matters most for US citizens working in Netherlands:
- •Netherlands has progressive income tax rates up to 49.5%
- •FEIE can exclude up to ~$126,500 from US taxation if you meet the physical presence test
- •30% ruling may apply for highly skilled migrants, reducing taxable income
- •US-Netherlands tax treaty helps prevent double taxation
Who taxes you?
As a US citizen working in the Netherlands, you're subject to taxation by both countries. The US taxes citizens on worldwide income, but the Foreign Earned Income Exclusion (FEIE) can exclude up to approximately $126,500 of foreign earned income if you meet the 330-day physical presence test. The Netherlands taxes residents on Dutch-sourced income with progressive rates up to 49.5%. The 30% ruling may apply for highly skilled migrants, allowing 30% of salary to be tax-free. The US-Netherlands tax treaty provides foreign tax credits to prevent double taxation.
Common pitfalls
- Dutch tax rates are very high, with top marginal rate of 49.5%
- 30% ruling eligibility is complex and requires specific conditions
- Not meeting the 330-day physical presence test disqualifies you from FEIE
- State tax obligations may persist if you maintain US state residency
Frequently asked questions
Yes. US citizens must file US tax returns regardless of where they live. However, you may not owe US taxes if your income is below the FEIE threshold and you meet the physical presence test.
The FEIE allows you to exclude up to approximately $126,500 (indexed annually) of foreign earned income from US taxation if you meet either the bona fide residence test or the 330-day physical presence test.
The 30% ruling is a Dutch tax benefit for highly skilled migrants that allows 30% of your salary to be tax-free for up to 5 years. Eligibility requires specific conditions including having specific expertise not readily available in the Dutch labor market and employer sponsorship.
The Netherlands uses a Box 1 income tax system with progressive rates up to 49.5%. The 30% ruling may apply for eligible highly skilled migrants, reducing taxable income. You can claim foreign tax credits on your US return to offset taxes paid to the Netherlands.
Generally no. The US-Netherlands tax treaty and foreign tax credits help prevent double taxation. You'll typically pay the higher of the two tax rates, not both.
Official resources
Primary sources:
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