Key tax changes from 1 January 2023

On December 20, the upper house of the Dutch parliament (the Senate) approved plans for changes in taxation for 2023. These plans will come into effect after approval by the king and official publication. It is expected that the approval will pass without problems. Nalog.nl has repeatedly written about plans to change taxation, but only now the plans have become clear and concrete. 

Learn about the main changes in their areas:

What will change in Box 1 of income tax?

From January 1, 2023:

1. For employees with an income of up to 73 euros per year, the tax will be reduced to 031%. 
2. They will increase the tax benefit for those who earn from 37 to 697 euros per year. 

Tax savings from the first change will be about 102 euros, from the second - about 500 euros.

Besides:

• Tax-free tolls will increase to 21 cents from the current 19 cents per kilometer.
• Employees who have received stock options in their companies in lieu of salary will be able to choose when to pay tax: waiting for the moment when the shares start trading on the stock exchange, or not waiting for it.
• Self-employed seek to bring closer to employees in terms of payment, so the tax deduction for them will be reduced from 6310 to 5030 euros.
• They will cancel the averaging scheme and exclusions from the regular wage system for innovative startups.
• Entrepreneurs will no longer be able to exempt old age money from taxation if these funds work in business. The only option is to place these funds in annuity accounts.
  

Additional information on government support for entrepreneurs can be obtained in our article.

What will change in Box 2 of income tax?

• Limit excessive borrowing from your own company, which allowed you to get a tax deferral. Owners of large shares of companies will have to pay Box 2 income tax on loans received from their own company on amounts exceeding 700 euros. 
• The corporate taxation of companies subject to a reduced tax rate will be adjusted. To enter this group, the revenue threshold for companies will be reduced from 395 to 000 euros per year, and the tax for companies in this group will increase from 200 to 000%. For companies of the second group, the rate will remain the same - 15%.
• The tax-exempt investment in the work of your company will increase to 3%, provided that the wage fund does not exceed 400 euros.
• The deductions for environmental investments will increase by 50 million euros per year, and deductions for investments in energy by 100 million euros per year.

What will change in Box 3 of income tax?

• The tax-free amount of savings will increase to 57 euros. At the same time, the tax rate will increase to 000% (previously the rate was 32%).
• The bar for tax-exempt donations is capped at €250 per year, for both single donors and tax partners. Previously, donations to public benefit institutions made it possible to significantly reduce or even nullify tax payments.

What will change in taxes when buying a property?

• The amount of a tax-free gift to children for the purchase or renovation of a home has been reduced to 28 euros. From 947, this tax benefit will be completely abolished. More about this benefit, called Jubelton, in our article.
• For first home buyers, if the buyer is under 35 years of age, the marginal value of the home is increased, at which the buyer is exempt from paying property transfer tax. Now the cost of the house can be 440 euros (was 000 euros). Learn more about this benefit in our article.
• The property transfer tax rate, if the buyer does not live in the purchased house, rises from 8% to 10,4%. 
• For houses costing from 75 to 000 euros, the conditional cost of rent will be reduced - now it will be 1%. In the Netherlands, it is considered that the owner of his own home receives additional income due to the fact that he does not have to pay rent, and this income is taxed. Now such owners can pay less.  
• The land tax will be abolished, allowing housing associations to invest more in social housing.

What will change in taxes designed to reduce the impact of humanity on the environment and climate?

1. On long-distance and short-haul flights, the flight tax will increase from 7,95 euros to 26,43 euros per air ticket. Learn more about this tax in our article.
2. Individuals will be exempted from paying VAT on the purchase of solar panels that generate energy. Nalog.nl can help you return VAT paid on the purchase of solar panels.
3. Tighten environmental requirements for cars in accordance with the current level of technology development. Owners of older cars will have to pay more, which should lead to the disposal of environmentally harmful vehicles. More about motorist taxes in our article.
4. The list price of cars that do not produce harmful emissions into the atmosphere, which allows you to get a tax rebate, will be reduced from 35 to 000 euros. Buyers of such machines will be able to save up to 30 euros.
   
   Learn more about taxes introduced to address environmental issues. in our article.

What will change in excises?

• From April 1, 2023, the excise tax on tobacco will increase. A pack of cigarettes will cost an average of 9 euros, a pack of hand-rolled cigarettes - 14 euros. The excise tax on cigars will be 10% of their selling price. The increase in these excises aims to achieve zero first-time smokers by 2040.
• From April 1, 2022, the government reduced the excise tax on fuel due to a sharp increase in fuel prices. The reduced excise duty will apply until July 1, 2023. Further, excise taxes on motor fuel will be: for gasoline - 0,789, for diesel fuel - 0,516, for liquefied gas - 0,186 euros.

Company Nalog.nl Reminders of approaching tax filing season! Our experts are ready to help you fill them out and submit them to the tax authorities. You can place an order for this service by going to at this link. *Link here YouTube shorts about tax filing discount