Netherlands – Changes to Social Security Rates, Minimum Wage, Income Tax Rates and Credits
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Changes to Social Security Rates, Minimum Wage, Income Tax Rates and Credits
On Tuesday 17 December 2024, the Dutch Parliament voted in favour of the Tax Plan 2025 and the other bills presented on Budget Day. The Tax Plan and other bills propose the following changes, effective 1 January 2025:
Changes to Minimum Wage and Social Security
The government adjusts the amount of the minimum wage twice a year – on 1 January and 1 July. From 2024, the minimum wage is an hourly wage and no longer a monthly, weekly or daily minimum wage. The minimum wage for 2025 is as follows:
| Age | Hourly Minimum Wage (€) |
|---|---|
| 21 years and older | 14.06 |
| 20 years | 11.25 |
| 19 years | 8.44 |
| 18 years | 7.03 |
| 17 years | 5.55 |
| 16 years | 4.85 |
| 15 years | 4.22 |
The maximum annual salary basis cap for employer contributions is amended from €71,826.00 to €75,864.00.
The Social Security rates have been amended as per the following table:
| Social Security | 2024 | 2025 |
|---|---|---|
| General Unemployment Insurance (AWF) High | 7.64% | 7.74% |
| General Unemployment Insurance (AWF) Low | 2.64% | 2.74% |
| Occupational Disability Insurance (Aof) High | 7.54% | 6.28% |
| Occupational Disability Insurance (Aof) Low | 6.18% | 7.64% |
| Healthcare Insurance (ZVW) - Employer | 6.51% | 6.57% |
| Healthcare Insurance (ZVW) - Employee | 5.26% | 5.32% |
| Work Cost Ruling Scheme (WKR) – Up to EUR 400 000 | 1.92% | 2% |
| Work Cost Ruling Scheme (WKR) – Above EUR 400 000 | 1.18% | 1.18% |
ZW-Flex (Werkhervattingskas)(Whk) has retroactively changed the indexed rates:
The wage limit will be indexed retroactively by 6.60 percent as of January 1, 2024, based on the average contract wage development of companies over 2024 as included in the Macro Economic Outlook 2025 of the CPB.
Changes to Income Tax Rates and Tax Credits
The rates for wage tax are amended as below:
No AOW and AOW born before 1946
| Income From (€) | Income To (€) | No AOW | AOW Born After 1946 |
|---|---|---|---|
| 0 | 38,441 | 35.82% | 17.92% |
| 38,441 | 76,817 | 37.48% | 37.48% |
| 76,817 | Above | 49.50% | 49.50% |
AOW born before 1946
| Income From (€) | Income To (€) | AOW Born Before 1946 |
|---|---|---|
| 0 | 40,502 | 17.92% |
| 40,502 | 76,817 | 37.48% |
| 76,817 | Above | 49.50% |
The rates for general tax credit are amended as below:
| General Tax Credit | No AOW | AOW |
|---|---|---|
| Basic credit | €3,068 | €1,536 |
| Maxim calculation base | €28,406 | €28,406 |
| Deduction for each €1 over maximum | 6.337% | 3.170% |
| Reduction complete at | €76,817 | €76,817 |
The rates for labour wage tax credit are amended as below:
| Income From (€) | Income To (€) | No AOW | No AOW Tax Credit (€) | AOW Rate | AOW Tax Credit (€) |
|---|---|---|---|---|---|
| 0 | 12,169 | 8.053% | 980 | 4.029% | 491 |
| 12,169 | 26,288 | 30.030% | 4,240 | 15.023% | 2,121 |
| 26,288 | 43,071 | 2.258% | 379 | 1.130% | 190 |
| 43,071 | 129,078 | (6.510%) | 5,599 | (3.257%) | 2,802 |
The rates for elderly wage tax credit are amended as below:
| Elderly Wage Tax Credit | |
|---|---|
| Base Credit | €2,035 |
| Maximum calculation base | €45,308 |
| Deduction for each €1 over maximum | 15% |
| Reduction complete at | €58,875 |
Single elderly wage tax credit is € 531.
Please contact your Mercans’ services delivery team for any additional information regarding the implications of the above change.
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