Tax penalty for early retirement schemes in The Netherlands will be increased to 65% in 2028!
Publication date: June 23, 2025
In 2024, social partners and the government agreed to extend the so-called RVU threshold exemption beyond 2026. It is now clear at what cost: employers will be required to pay a 65% levy on arrangements that fall outside the scope of the RVU exemption.
RVU threshold exemption
Employers may continue to apply the RVU threshold exemption for employees after 2026 without a tax penalty. The fiscal conditions include a maximum gross payment of €2,273 per month, within the 36-month period preceding the state retirement age (AOW). If a collective labour agreement (CLA) or CLA parties are involved, the scheme is only accessible to individuals engaged in demanding work. Such work must be substantiated with objective criteria and linked to efforts aimed at sustainable employability. See our recent update on the RVU threshold exemption (June, 3) for further details.
Gradual increase of the RVU tax penalty to 65%
The fine print of the published documents explicitly states that the RVU levy will increase from 52% in 2025 to 65% in 2028. This RVU penalty is payable by the employer for early retirement arrangements that either precede the 36-month period or exceed the threshold exemption amount during that period.
Virtually no chance of grandfathering the 52% rate
It is highly likely that the stepwise increase in the levy rate will apply to all RVU payments made from 2026 onwards, provided the threshold exemption does not apply. This is due to the inherent transitional nature of the phased increase and the practical difficulties the tax authorities face in verifying and enforcing the timing of RVU agreements.
High likelihood of implementation
The phased increase in the levy rate, the (temporary) extension of the threshold exemption beyond 2026, and the increase of the monthly exemption amount by €300 gross in hardship cases will be formalised in the 2026 Tax Plan. The likelihood of implementation is very high, as the entire RVU package is based on an agreement already reached between social partners and the government.
What Now?
For existing arrangements that will continue to result in payments after 2025, it is advisable to assess whether measures can be taken to avoid the RVU levy altogether. This may be achieved by developing and agreeing on an alternative for payments that have not yet commenced. For new arrangements, it is more important than ever to design schemes that do not qualify as RVUs. There are often alternatives available within the current (and future) fiscal framework. The RVU threshold exemption, pension enhancements, or senior employee schemes are among the most well-known examples.
