My partner has no income, is she entitled to a refund or tax credit?
General tax credit
Under certain conditions taxpayers can be eligible for the so called general tax credit. This is a tax credit on the calculated income tax or wage tax. Due to this credit you pay less tax.
The tax credit is already taken into calculation by the employer or social security organisation. If your partner doesn't receive an income the tax credit is not automatically granted. In that case it is necessary to request the tax authorities directly to reimburse the tax credit to your partner. This can be done if you have paid enough tax to support the tax credit. So in the Netherlands each person is taxed individually, but to determine whether tax credits can be claimed it is necessary to look at the income details of both (fiscal) partners.
The general tax credit is a fixed amount. After official retirement age it will become lower. Since 2009 the payment to the partner who doesn't receive (sufficient) income is reduced annually. This happens over a period of 15 years.
The calculation of the reduction has been changed during the recent years. This means that for example for the years 2012, 2013 and 2014 the reduction is calculated in a different way. The reduction depends on date of birth and since 2014 also on the income earned. If Expatax prepares your tax return the correct amount will be calculated.
Conditions to qualify for direct payment by the tax authorities
To qualify for the general tax credit you must satisfy the following conditions:
- you and your partner are fiscal partners;
- you are liable to tax (registered with the Dutch tax authorities);
- you don't have (sufficient) income;
- your partner pays sufficient tax.
Claim the general tax credit