Comments
An important part of this proposed new legislation concerns a transitional arrangement, on the basis of which the limitation of the 30% facility will only apply as from 1 January 2026, for incoming employees to whom the 30% facility has been “applied” over the last wage period of 2022 (i.e., typically the December 2022 payroll).
It is not fully clear what is meant by the word “applied” in the previous sentence. Initially, we had taken the viewpoint that it should be sufficient if the employee is entitled to the 30% facility as per December 2022. If so, we were of the opinion that the 30% facility could be applied for this period, and that the 30% facility could therefore be processed (even retroactively) in the payroll run of December 2022 (e.g., via a so-called ‘correction notice’ via the Dutch payroll system).
However, recent discussions with the Dutch tax authorities have shown that under the current proposals, it may be preferrable to take a stricter approach to ensure the transitional arrangement applies. They mentioned that in cases where it is highly likely that the 30% facility will ultimately be granted for a period that includes December 2022, the safest approach is to actually apply (i.e., process via the payroll) the 30% facility in the payroll run of December 2022, even if the tax authorities have not yet issued the formal 30% facility grant at the moment of processing said 30% facility in the December payroll.
For cases where certain employees are eligible for the 30% facility for a period that includes December 2022, while the formal 30% facility grant may not be issued before the December 2022 payroll deadline is passed, the safest approach to secure the transitional arrangement would therefore be to apply the 30% facility provisionally in the payroll and pay out the net amount connected with the 30% facility, but inform the employee that this amount should be repaid to the employer if the 30% facility is for some (unlikely) reason not granted in the end.
Should you require any additional information or assistance with the administration of the 30% facility for incoming employees, please reach out to us.
