How it works
Dutch income tax has three boxes. Box 1 covers income from work and home. Salary from a job or from your own BV, profit from a sole proprietorship, benefits, pensions and the deemed income from the house you live in all go here.
Box 1 uses brackets. In 2026 the rates are 35.75% up to €38,883, 37.56% up to €78,426 and 49.5% above that. People at state pension age pay a lower rate in the first bracket because they pay fewer social contributions.
Tax credits lower the outcome. Everyone gets the general tax credit; people who work get the labour tax credit on top. Both credits phase out as income rises, which makes the real rate on extra income higher than the bracket rate suggests.
For a DGA, box 1 is the salary side. Profit kept in the BV is taxed with corporate income tax instead, and dividend later in box 2. That is why the choice between salary and dividend decides the total tax bill.
Example
A DGA pays herself €58,000 in 2026. The first €38,883 is taxed at 35.75%, the rest at 37.56%. She deducts the general tax credit and the labour tax credit. Her net salary is about €42,000 a year; the DGA salary calculator gives the exact figure.
The figures
All 2026 figures: Netherlands tax rates 2026 · the 2027 figures: Netherlands tax rates 2027.
Questions people ask
Does mortgage interest still lower box 1 income?
Yes. Interest on the mortgage of the house you live in is deductible in box 1, at a capped rate, against a deemed income from that house.
Where does profit from a BV go?
Profit of a BV is taxed with corporate income tax in the BV. Only the salary the DGA receives goes in box 1; dividend goes in box 2.
Holdwise, Hoofddorp. Definition and explanation maintained with the Dutch and German glossaries; figures from the central rates source, year 2026. Updated 16 September 2026.
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