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I'm a US citizen, working currently for a US company, but am considering a position for a company in Amsterdam. In absolute terms, the Amsterdam job would pay roughly 13% less than I am currently earning in the United States. But how does this compare after taxes, health insurance, etc?

At my current employer, my take-home pay, after tax withholding, etc, is roughly 73% of my base salary. My employer also pays 100% of my health insurance costs, which is a big bonus.

So how can I quickly estimate my take-home pay based on a base salary in the Netherlands to make a roughly apples-to-apples comparison?

Gala
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Flimzy
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  • possible duplicate of How to match EU income to US salary? – Greg Hewgill Jul 17 '15 at 00:10
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    @GregHewgill: I disagree. That question is asking about salaries in the US, coming from the EU (specifically, from Paris). That's different (and opposite) from what I'm asking. A duplicate question would be about going from the US to the EU, but that question would be far too broad. – Flimzy Jul 17 '15 at 00:17
  • I think you need to tell us if your are in a major city or not. Man u of the living cost comparison sites only work for major cities. – StrongBad Jul 17 '15 at 00:49
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    @strongbad: I'm coming from Wichita, KS, going to Amsterdam. But I'm more interested in general rules. I can look up the per-city cost of living easily enough, but that doesn't generally take into account differences in taxes, insurance and other obligatory expenses. – Flimzy Jul 17 '15 at 01:31
  • I would ask company to provide you final cost estimation. The pay offs are automated and it is not problem for them to give you precise estimate of your earnings per month including travel allowance. Don't forget that in NL you will get 13th salary as holiday allowance. Also ask them short call for explanations if it is not clear. If they disagree I would consider it as sign of bad relocation support and careless to own people – Eugen Martynov Jul 17 '15 at 02:18
  • What type of work would you be doing? – Gala Jul 17 '15 at 05:08
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    Another thing to consider when making comparisons: You will probably look up rent, utilities, groceries, etc. but having a car is likely to be much more expensive in the Netherlands, think about that if you expect to have one. – Gala Jul 17 '15 at 05:26
  • @Gala: Software development. – Flimzy Jul 17 '15 at 13:29
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    @Gala the relative desirability of owning a car is rather different between Wichita and Amsterdam. I have never been to Wichita, but I expect it's like most of the other parts of the Midwest I'm familiar with where life without a car would be rather difficult, at best. In many parts of Amsterdam the inconvenience of owning a car would be so great as to outweigh the relatively small benefit even if someone else were covering the costs. Or, to put it another way, being liberated from car ownership was one of the best things about moving to Amsterdam. – phoog Apr 04 '16 at 21:54
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    @phoog Yes, of course, and personally I made the same choice. But I also know people who just expect to own a car, without thinking too much about it. If that's your case, you're in for a big surprise. And then if you don't have a car, you also need to budget for other means of transportation. So you better look into this into more detail before making comparisons. – Gala Apr 10 '16 at 22:47

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Here is one simulator you can use for that. You can find others by looking for things like “nettoloon” or ”bruto netto” together with “Nederland” (name of the country in Dutch, to get rid of results about Belgium).

You haven't said anything about the type of work or the level of salary but my guess would be that you can expect the take-home pay to be slightly lower than in the US, on the order of 60-65% of your base salary.

In the Netherlands, what's withheld (called loonheffing in Dutch) includes both taxes (loonbelasting) and some tax-like contributions that provide most of the funding of the health insurance and basic pension system (bijdrage Zorgverzekeringswet and premie volksverzekeringen). On top of that, you will have to pay roughly €100 every month to an health insurer (I believe it is illegal for an employer to pay these €100 or to cover the legally mandated deductible, what employers can offer instead is to pay for optional insurance above the basic health insurance, e.g. to cover alternative medicines, treatment abroad, etc.)

Again assuming we are talking about a well-paid job as a professional, you would also probably qualify for the 30%-ruling (your employer has to apply for that on your behalf). If successful, you would pay taxes on 70% of your salary, the rest would be paid to you entirely (i.e. tax-free). You would also be exempt of taxes on property abroad but you would not accrue any pension rights on the tax-free part of your salary.

Finally, beyond all the usual costs (rent, utilities, groceries…), you can also expect a few other mandatory expenses: municipal taxes (in Amsterdam, that's about €400 per year for a single-person household and €470 for a family for waste and sewage but there also additional taxes if you have a dog, own a house, etc.) and water board taxes (that's the institution in charge of dikes and flood protection, perhaps €200-400 per year).

Gala
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    Don't forget additional benefits. For example, in The Netherlands it is very common for employers to pay for commuting costs, to pay a significant amount of extra money at vacation, and even to pay 13 months salary per year. – gerrit Jul 17 '15 at 09:41
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    @gerrit It's more meaningful to think about salary on a yearly basis so that a 13th or 14th month does not make any difference. I assumed that's what Flimzy did too. The only problem is that the site I mentioned makes a calculation based on the monthly salary so it might underestimate taxes a little. – Gala Jul 17 '15 at 10:44
  • Not paying for your commute is nice but that's a compensation for your costs so that's a wash, financially. And you can also choose not to have a commute for better quality of life so that's one of the things everyone has to decide based on their personal preferences/situation, not so much a characteristic of the tax system as such. – Gala Jul 17 '15 at 10:49
  • That choice is not available to everybody, as more than one person in the same household may need to commute. I don't agree that it's a wash, it can run into thousands of euros per year. – gerrit Jul 17 '15 at 11:05
  • @gerrit Sure but if you are in the process of deciding to take a job on the other end of the world, you do have to choose where you live in any case. Either way, it's not really a benefit in the same sense than a vacation allowance, it just covers some costs you incur. And how far you commute will also depend on the size of the city, where you want to live, etc. again a matter of personal preference and local situation, not a characteristic of the tax system that would apply to everybody. – Gala Jul 17 '15 at 12:37
  • I am not saying it's unimportant but I don't think it addresses the question or belongs in the answer, otherwise we would turn it in a full discussion of the cost of life, schooling for the kids, restaurants and all the things you might need to sustain a certain lifestyle. – Gala Jul 17 '15 at 12:42
  • Is health insurance of about €100 paid per person? e.g. a family of 4 would pay €400 per month? Also is the 30% ruling commonly granted? – CadentOrange Mar 24 '16 at 11:52
  • @CadentOrange Yes, it's per person. Don't know about the other question but I was under the impression that it was not very difficult (if you fulfil the conditions that is). – Gala Apr 04 '16 at 19:03
  • @gerrit: there is no extra money for vacation, it's just money that they take each month from your salary and pay out in May. – vartec Apr 04 '16 at 22:20
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    @CadentOrange: €100 is minimum you have to pay just for health insurance (as in, does not include dental), but it's only per adult. Children under 18 are exempt. The minimum deductible now is few hundred euros, so in fact unless you're hospitalized for something serious, your healthcare spendings will go mostly out of your pocket. – vartec Apr 04 '16 at 22:24
  • I'd add to that, that if you plan to own a car, besides it being small and 3 times as expensive as in US, and besides gas being $7-$9 per gallon, also you'll have to pay circulation tax which is €1500-€2500 every year. – vartec Apr 04 '16 at 22:29
  • @Gala: I've seen a dude commute from Antwerpen to A'dam on Thalys every day. Reimbursed by the company. That is bit extreme example. But more normal examples would be people commuting from Haarlem, Utrecht, The Hague, Almere etc. At €0.19 per km it comes out to €300-€600 a month. Tax free. – vartec Apr 04 '16 at 22:38
  • @vartec I commented on the car under the question, don't thing it should be added to the answer, lest I turn it into a full discussion of cost of life in the Netherlands (as opposed to take home pay per se). For your Thalys example, sure it can represent a lot of money but still, it pays for a cost you incur, it's not a benefit. Someone living next to their office does not get €300 but does not spend them on trains either. The only thing is that if you save on rent/mortgage by living in a cheaper place then you can in fact come out on top financially. – Gala Apr 10 '16 at 22:40
  • And the fact it's tax-free is not even relevant (I thought there were in fact limits but an employer may very well pay more money for a commute, as long as they also pay taxes on that extra compensation). People get all worked up about the tax aspect but no matter how you cut it, it's not money available to spend on anything else than costs your are incurring because of your commute. – Gala Apr 10 '16 at 22:42
  • @Gala transport reimbursement affects take home pay significantly. – vartec Apr 10 '16 at 22:42
  • @vartec For the third time, no. it does not, not in the same sense than taxes and mandatory contribution do. If you don't have a long commute, you get less money but you have lower costs and if you live next to your workplace you don't get any tax-free money but you don't incur any costs... Meanwhile the pay itself stays the same. – Gala Apr 10 '16 at 22:51
  • If you want to talk about all that meaningfully, you also have to take into account the transportation system and urban density, personal preference on the location vs. length of commute trade-off. It's completely different from the question of how the fiscal system impacts take-home pay, etc. We have no way to know where the OP would be living or what their comparison point is (Would they have a longer or shorter commute? Do they pay any money for their commute in their current job or do they live within walking distance?) and it's clearly out of scope. – Gala Apr 10 '16 at 22:53
  • I'll just say that IMO 5%-20% is significant. For you it isn't, so let's agree to disagree. – vartec Apr 10 '16 at 23:01
  • @vartec But 5%-20% of what? It makes no sense to express it as a percentage and for some people it will be 0%… You could find someone getting €10000 a month to commute by helicopter, it would still make absolutely no difference to either their gross salary, take-home pay or disposable income. Are you trying deliberately to be silly? – Gala Apr 10 '16 at 23:04
  • Of take home pay. It would be zero only if you live at work :-P – vartec Apr 10 '16 at 23:06
  • @vartec Which is what I have said. Twice. Because that's exactly the point. It's not extra money you get, it does not affect the relationship between gross salary and take-home pay, it's a compensation for something you might or might not need or can even choose to forgo. Rent differences aside, the difference in income between someone commuting one hour by train and someone walking next door is €0 or 0% (of everything). One of them will see money going in and out but it's a wash. – Gala Apr 10 '16 at 23:09
  • (and it's not even exactly true that it's 0 if you live at work, my employer does not pay for commutes under 10 or 12 km, I think). – Gala Apr 10 '16 at 23:12