Payroll tax credit

Payroll tax credit or "loonheffingskorting" is a tax credit you receive when you work or have worked. This means you pay less tax on your salary. There are several tax credits, of which payroll tax credit is one. Payroll tax credit consists of the general tax credit and the employment credit. The benefit of all these credits? You get more money in your account!

Your payroll tax credit is calculated based on your income. The maximum employment credit in 2024 is €5,532 per year. For an income starting from €39,393, the employment credit decreases gradually. So, the amount of payroll tax reduction applied to you depends on your salary. You can see how to calculate the employment credit on the Tax Authority's website.

Are you employed? Then you request the payroll tax reduction using the Tax Authority's form. Often, you receive this form from your (future) employer, who then ensures that the payroll tax credit is applied. You usually request the credit when you start a new job, but it can also be done later.

Please note: If you have multiple employers, you can only apply the payroll tax credit to one employer.

You apply payroll tax credit when you work. This means you pay less tax and take home more net salary. Do you have multiple employers? Then you only request payroll tax reduction for one job; otherwise, you will receive too much employment credit. Tip: apply the employment credit to the job where you earn the most to get the most money back.

Do you want to adjust "loonheffingskorting," for example, because you have a new job? Then fill out the Tax Authority's tax withholding form. You usually receive this from your employer, but you can also download it yourself from the Tax Authority's website.