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Dutch social security and taxes

General information on Dutch social security and taxes.
If this is your first encounter with Holland, you may feel puzzled by Dutch social security.
Holland has a long tradition in care and social benefits. In recent times, the role of Dutch government has become less extensive as it used to be, but still the Dutch system of social security rates among the best in the world.

Our aim is to make you feel familiar with this system, not only by saying what it is but by explaining what it means in relation to your own financial risks and benefits. So don’t hesitate to contact us if you feel that blank spots in this respect need to be filled in.

Here you find the components of and parties in social security in Holland you are likely to encounter.

Institutions

Institutions that administrate most of the social security benefits are:

SVB – Sociale Verzekeringsbank
Literally the social security bank. It administrates provisions like the AOW, ANW, AKW and some health care benefits.

UWV – Uitvoeringsinstelling Werknemersverzekeringen
This institution administrates rules and regulations under for instance WW and other work-related benefits.

 

Social security laws

AOW – Algemene Ouderdomswet
The general old age pension, in vigor for every resident. It provides a basic income as of the age of 67.

ANW – Algemene Nabestaandenwet
The general surviving partner’s pension. It provides a basic income for the surviving partner under strict conditions. One condition is a possible complete deduction when having your own income.

WW – Werkloosheidswet
The general unemployment benefit, for employees being laid off. It provides an income of not more than 70% of the former salary and limited to a time dependent on the working history.

AKW – Algemene Kinderbijslag Wet
A general benefit for parents with children under 18 years old.

WWI – Wet werk en inkomen
This minimum benefit could be applicable when no other means of income are available. This law maintains an extensive and strict limitation for wealth components, partner income and job applications.

 

Tax rulings

Wet Inkomstenbelasting
This is the general income tax law. The Dutch income tax system is progressive, which means that taxing depends on the level of income. There are basically three levels of income with climbing tax rates.

30% ruling
An employee may sometimes obtain a special status before the income tax. This means basically that a part of the taxable income from employment may be exempted from income tax. This special status is for a limited time only.