If you are an expat under the 30% ruling you will have understood by now that the maximum period will be 5 years. Also for you. No transitional arrangement for existing 30% ruling holders.
No transitional arrangements for existing 30% ruling holders – Mr Quick
The secretary of State in charge of this ruling and its update his name is Mr Snel. In English that would be Mr Quick. Mr Quick does his name justice by changing this ruling quickly, but not taking into account the rights of existing 30% ruling holders. In my opinion Too Quick.
Mr Quick states that the changes have immediate effect for all holders, not only the new applications from 2019 onwards. Making an exception to the rule would create complex legislation and then the discussion would be till what point you make the exception to the rule.
Mr Quick even stated that contract partners for the long run need to take into account that changes in legislation can affect business relations and tax implications, that is part of business. Mr Quick also stated that the expats to whom this applies should be grateful the other option of maximizing the amount representing 30% has not been chosen.
No transitional arrangements for existing 30% ruling holders – Too Quick
In my opinion Mr Quick is incorrect on all points. The problem is in how the ruling is presented to you. The ruling is presented in a statement open for appeal, in which clearly is stated the period for which the ruling is valid.
Contract partners for the long run that have agreements in which periods are fixed cannot have issues with changed legislation due to the contracts made. So this point of we disagree. And the other option of maximizing the amount of the 30% part has never been a true subject of discussion.
What would have been a solution?
We understand that the European Union is the only cause this rule is being update. Not the budgets or the business climate. The ruling was too favorable. So limiting it to 5 years can be a choice, but then only for new applicants onwards and you can then even share among those the current 30% ruling holders that switch jobs, who need to reapply and then their ruling is maxed to 5 years overall.
That is still not a nice situation if you are an expat under this ruling, but then you have your transitional arrangements without discussion till what point to go. The point is clear. You live up to the statement issued by the tax office and you meet the desire of the EU to limit the ruling.
Making an appeal successful?
If you have an agreement with the tax office that explicitly states a period during which a ruling is valid, we have the opinion that all parties (employer and employee) cannot see this any different that a solid agreement. Making a change by simply dismissing this agreement is not how a good Government should behave plus it is a breach of contract. From a logical point of view we see the appeal having success.
At the same time we will not assist any application with such an appeal as we think it is a waste of time and money. The Government only does this the way it is being done if they are sure it will not hurt them in legal cases. And the past has proven the Government to be very good at this.