Taxpayers can't figure out health care costs

About 28% of tax returns that include health care expenses are filled out with errors. This concerns an amount of 346 million euros (39% of the reported health care costs). The Minister voor Langdurige Zorg en Sport Conny Helder presented a report with these figures and indicators to Parliament.

Tax deduction and health care allowance

Low-income Dutch people are eligible under certain conditions to receive benefits related to health care costs:

• aftrek zorgkosten - tax deduction for healthcare expenses;
• tegemoetkoming specifieke zorgkosten (TSZ) – allowance for medical expenses.

Taxpayers can deduct certain health care costs from income tax, to a limited extent. For example, this applies to the cost of medicines and other medical aids. However, even after applying the deduction, sometimes low-income people may also qualify for benefits. If the taxpayer, filling out the tax return, indicated the costs of health care and meets the conditions for receiving benefits, then the tax authorities accrue it automatically.

Too complex scheme

Tax officials agree that the health care reimbursement scheme has a very complex structure. Taxpayers have ambiguities on many cost items, as a result of which they make mistakes. The authors of the report to the government are concerned about how feasible and applicable this scheme is in the form in which it is now.

The tax authorities check only part of the declarations

At the moment, the tax office cannot check all declarations. Declarations for verification are selected by the tax authorities by applying certain criteria. It is not possible to process all declarations that may contain tax risks.

The correctness of the application of the TSZ scheme is also in question

According to the tax authorities, errors may occur in this case not so much through the fault of taxpayers as for technical reasons. Moreover, the calculation rules themselves require specification.

The authors of the report to the government recommend that the purpose of the scheme be more clearly defined, as well as to establish to what extent the government is ready to compensate the medical expenses of the target group. In addition, municipal health care reimbursement schemes also require improvements. It is necessary to ensure that taxpayers understand the specifics of the application of such schemes - then the likelihood of errors in tax returns will be reduced. Long Term Care and Sports Minister Connie Helder and Finance Minister Sigrid Kaag promised to comment on the report at a later date.