Holiday Allowance (Vakantiegeld) in the Netherlands
In the Netherlands, vacation planning is backed by law through a mandatory financial buffer known as Vakantiegeld. Every employee is entitled to a holiday allowance to ensure they have the financial means to take time off and rest during the year.
How is Vakantiegeld Calculated?
The legal minimum for the holiday allowance is **8% of your gross annual salary**. This includes your base wage, but generally excludes bonuses or travel allowances unless stated otherwise in a collective labor agreement (CAO).
- Accrual Period: The allowance builds up monthly, typically tracking from June 1st of the previous year to May 31st of the current year.
- Payout Window: By law, employers must pay out the accrued holiday allowance in a single lump sum during the month of May or June.
The Taxation Reality (Bijzonder Tarief)
A common surprise for expats is that the holiday allowance looks heavily taxed when paid out. This happens because it is classified as a special reward or bonus income. Therefore, it is subjected to a special tax rate (bijzonder tarief) right away, meaning your net payout will be lower than a standard monthly net salary percentage.