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Written by:
Bas Hollenberg


Gap between jobs causes 30% ruling to be forfeited

A gap between jobs of three months or longer rightly causes the expat worker in question to forfeit his or her eligibility for the 30% ruling: this is how the Supreme Court of the Netherlands recently ruled in a case involving an expat worker who after a five month gap of having resigned his original position – during which interval he had also embarked on a search for somewhere else to live – started a new job elsewhere.  

The 30% ruling has been specially designed with the aim of compensating expat workers on a tax-exempt basis for the accommodation costs they incur in a country which is not their own. The scheme is available on request to those expat workers who boast a particular type of expertise that is considered thin on the ground in the Dutch labour market, and boils down to 30% of the expat worker’s total remuneration being paid out to him or her on a tax-exempt basis. A job switch need not cause the expat worker to forfeit his or her privilege on condition that the gap between jobs should not exceed a three month term, the argument being that anyone who remains out of work for more than three months cannot, or no longer, be regarded as boasting scarcely available expertise. 

The expat worker in question had failed to comply with the above condition, it not being permissible under the 30% ruling for those who make use of the scheme to decide for themselves for how long they should be unavailable to the labour market. According to the expat worker he had spent the interval house hunting and had in fact had landed a new job within three months of his having found suitable accommodation. Both the District Court and the Court of Appeal in previous instances had dismissed the expat worker’s assertion that his house hunting efforts had got in the way of his looking for a new job. The Supreme Court added that the three month term should not be interpreted as implying that spending less than three months looking for alternative employment suffices.

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