the 150 km limitation of the 30% ruling

The Court of Justice of the European Union determined that the 150 km limitation in the Dutch 30% ruling does not violate European Union (EU) law.
First an explanation of the 150 km limitation. People who lived in an area that is <150 kilometers from the Dutch border before moving to the Netherlands are not subject to the 30% ruling. This means that their labour conditions are less attractive than if the 30% ruling would be applicable. And this automatically means that it takes the employers more effort to bring those people to the Netherlands.

150 km limitation of the 30% ruling, not an obstacle

The limitation became an issue because some companies found it to be contrary to the principle of the free movement of employees throughout the European Union. Many companies with employees from Belgium, Germany, and Luxembourg, hoped that the limitation would be abolished by the Court of Justice of the European Union.
However, on February 24, 2015, The Court of Justice of the European Union decided that the 150 km limitation is no obstacle to the free movement of employees. Even despite the roughness of the regulation. It would be different if the limits, as meant by the 150 km limitation, would over-compensate the actual extraterritorial costs systematically.

The next step is that the Dutch national Court of Justice will have to examine and determine whether there is indeed a systematic over-compensation for the employees in concern. This step is pending and will take some time. It will be hard for the national court to find the relevant information with employers whose employees live on 150 km or less from the Dutch border. (Information on employees who claim actual extra costs).

In short, this means that the current regulations of the 30% ruling will stay in tact for the time being.

Should you like to read more about the 30% ruling and it’s requirements, please have a look at our 30% ruling service. Let us help you obtain the 30% ruling!

The website of the Dutch Tax Authority on the 30% facility might also be an interested read.

  • EURA 2008-2016
  • Worldwide ERC
  • ARPN
  • EURA