Heffingskorting (Tax Credit)
Use the Heffingskorting (Tax Credit) Calculator →What is Heffingskorting (Tax Credit)?
A heffingskorting is a Dutch tax credit that reduces the income tax owed - not the taxable income. This makes it more valuable than a deduction: a €1,000 credit saves exactly €1,000 in tax regardless of your bracket, whereas a €1,000 deduction saves only €355-€495 depending on which bracket you are in.
The two main heffingskortingen for employees are the algemene heffingskorting (general tax credit) and the arbeidskorting (employment credit). Both are calculated as a function of income and phase out at higher incomes. They are applied after Box 1 income tax is computed.
When to use Heffingskorting (Tax Credit)
Use when calculating Dutch net salary from gross. Both credits reduce your final income tax bill. If the combined credits exceed your income tax, the excess is generally not refundable - you cannot pay negative tax. Use the Netherlands income tax calculator to compute your exact credits automatically.
Worked examples
| Gross income | Box 1 tax | AHK credit | AK credit | Net tax |
|---|---|---|---|---|
| €40,000 | €14,175 | €1,628 | €5,685 | €6,862 |
| €60,000 | €21,832 | €1,178 | €4,747 | €15,907 |
| €80,000 | €32,010 | €0 | €2,109 | €29,901 |
Common pitfalls
The heffingskortingen are non-refundable: they can reduce income tax to zero but cannot generate a cash refund on their own. They also phase out - higher earners receive smaller credits. Many online salary calculators only apply the AHK and miss the AK, or vice versa, leading to inaccurate take-home estimates.
Frequently asked questions
What is the difference between the algemene heffingskorting and the arbeidskorting?
The algemene heffingskorting (AHK) is available to all Dutch taxpayers below state pension age. The arbeidskorting is only available to people with employment income - it rewards work. Both phase out at higher incomes. A typical €60,000 employee receives around €1,178 AHK and €4,747 AK in 2026.
Are the heffingskortingen applied by the employer or the tax authority?
The employer deducts payroll tax (loonheffing) monthly, which incorporates an estimated AHK. The full picture - including the arbeidskorting - is reconciled in the annual income tax return (aangifte inkomstenbelasting) with the Belastingdienst (Dutch tax authority).