Changes to Your Wallet in the Netherlands in 2025

“New year, new me!” says everyone looking to embrace a new calendar year with new responsibilities, resolutions, and hopes. A new year calls for many changes in our daily lives, some planned and some unplanned. While we plan to take up new hobbies, visit new destinations, or try new cuisines in the new year, there are some inevitable changes we have to face. One of them is the unavoidable changes to our wallets with the revised costs of our utilities and commodities in the Netherlands in 2025.

Every year, the Dutch government develops a new financial plan that impacts the income and lifestyle of locals and expats alike. The newly calculated budget indicates the upcoming year’s fares, taxes, and other costs. While the government aims to improve the overall economic situation with the revised taxes, it affects many households who are struggling to manage their savings.

This year, too, the Dutch government has planned a lot of financial changes, imposing new regulations and tax reforms. To understand the budget plans better, we have compiled a list of changes to your wallet in the Netherlands that may impact your finances in 2025.

Taxes

The Dutch tax department (Belastingdienst) has introduced a third tax bracket in 2025 with revised income thresholds and tax rates. The new tax rates and thresholds are:

• 1st bracket: 35.82% tax for gross annual income up to €38,441
• 2nd bracket: 37.48% tax for gross annual income from €38,441 to €76,817
• 3rd bracket: 49.50% tax for gross annual income over €76,817

Similarly, the employment tax credit in 2025 will increase from €5,532 to €5,599, whereas the general tax credit will go down from €3,362 to €3,068.

Additionally, the Dutch Immigration and Naturalization Department (IND) has introduced new salary thresholds this year for residency applications of highly skilled migrants.

From 2025, you will need to pay a four percent transfer tax on property purchased through shared deals.

Freelancers and Small Business Owners

From 2025, the tax department will carry out strict checks against false self-employment between freelancers and their clients. This check falls under the Employment Relationships Deregulation Act (DBA Act), which prevents the unfair treatment of freelancers. This means that freelancers must have more than one client and avoid making long-term contracts. If a company or client is found violating this rule, they will be forced to pay a fine or payroll taxes.

This year, freelancers and self-employed individuals can also apply for the small business ruling scheme (KOR) in other EU countries. Similarly, the SME profit exemption (mkb-winstvrijstelling) is set to reduce from 13.31% to 12.70% in 2025. It implies that self-employed and SME professionals will have to pay more taxes on their profits.

Starting and Ending Your Business

From 2025 onwards, if you’re inheriting a business and are over 21, you can apply for an inheritance or gift tax exemption under the Business Succession Scheme (BOR). This applies if the company’s value is under €1.5 million. If the value exceeds €1.5 million, you can claim up to 70% exemption over the exceeding amount. Similarly, if you donate your company to someone else, you don’t have to pay income tax on the remaining profit, as per the tax deferral scheme (DSR).

Government Allowances

The child benefits amount and childcare allowances will increase in 2025. The child budget is likely to rise by €75 per child, and the hourly childcare costs are also set to increase. The compensation amount for foster children will increase by 3.7% this year.

Minimum Wages

The Dutch government has announced an increase in the minimum wage amounts effective 1st January 2025. The minimum wage for employees 21 years and older will change from €13.68 to €14.06 per hour. The amount changes as per age.

From this year onwards, entrepreneurs will no longer receive low-income benefits for their employees. Also, employers won’t have to pay higher unemployment contributions for employees with a permanent contract of 30 hours a week working overtime for more than 30%.

Transport

The government and municipalities are set to introduce zero-emission zones or ze-zones nationwide. If you are an entrepreneur with an electric van or truck that does not exhaust emissions, you may receive a subsidy of up to €5000 on your vehicle. The government has also introduced a 75% discount on motor vehicle tax for zero-emission passenger cars. This discount is valid till 2030 and applies to new and used vehicles. You can receive a 25% discount on motor tax for plug-in hybrid cars.

Entrepreneurs will need to pay private vehicle and motorcycle tax from 2025 when they buy a new company van that runs on petrol, diesel, or LPG. The tax amount will be based on the energy efficiency of the van. However, the fixed tariff on the tax will go from €440 to €667.

On a lighter note, the fuel excise duty on petrol, diesel, and LPG will remain the same in 2025. The duties per liter will cost €0.79 for petrol, €0.52 for diesel, and €0.19 for LPG.

As for public transport, the cost of NS train tickets will likely increase by six percent in 2025. However, the fares will remain the same for children up to 11 years old.

Retail and Entertainment

The Dutch government plans to impose a ban on cash payments of over €3000. This ban is expected to come into effect from 31st March 2025 and applies to traders, vendors, commercial buyers, or any individual wanting to make cash payments of an amount more than €3000.

Gaming organizers and gaming machine operators will have to pay an increased tax on betting and lottery. The tax will increase from 30.5% to 34.2% in 2025.

Energy

There will be a reduction in the energy tax on natural gas in the year 2025. The tax rate will be reduced by €0.028 per m3 and applies to usage of up to 170,000 m3 per year.

We hope you have a better idea of how the cost changes are going to affect your wallet in the Netherlands in 2025. Please start planning your finances for the year if you haven’t already.