Bert van Essen, Author at XPAT.NL

Have you ever worn an Eastpak? It is about time

Eastpak is the most popular worn backpack. It already exists since the fifties of the last century. We will tell you the story.

The first Eastpak was made in the fifties for the American Army. Soldiers had to walk comfortable and have their hands free. The first Eastpak bag ( eastpak tas ) was born. Great bags made of strong materials.

Students at the universities noticed these strong backpacks immediately and started using them for taking their books with them. After that also other students at highschools wanted an Eastpak.

Lots of students want the Eastpak out of office

Nowadays the Eastpak backpack is still a strong brand. Lots of students still want an Eastpak bag. The Matt and nat is the most basic Eastpak that is worn to school. With its rounded top you recognize this bag immediately. The bag is available in many colours and many prints.

In the Out of office fits a 13 inch laptop and it contents 27 liters. Place enough for all your necessities. Made out of polyester this is a strong backpack that goes for years. It has padded shoulder straps so it carries very comfortable on the back.

A great Fanny pack: the Eastpak Springer

An other popular model is the Herschel. A great Fanny pack for everyday use. You wear it around your hips or crossbody. Made out of polyester it can hold your wallet, keys and creditcards. You wear it close to your body so pick pockets have no chance.

This comfortable small bag became popular for use during festivals, but nowadays they are used for far more purposes. Even when you go shopping it is an easy to carry bag.

They are made in many colours and have a strong zipper on the front. Do you go for a grey or black one, or are you more into a pink or green Springer? Combine it with your outfit, and you will be fashionable all the way.

Going to University in the Netherlands

For those seeking an English-language study program, the Netherlands is one of the most accessible countries to explore, for a variety of reasons.
For starters, over 2,100 courses are on offer here in English, constituting 23% of the bachelor’s degrees on offer here and 74% of the master’s degrees.

Tuition

Another reason why studying here is so attractive is because the level of education is high, with some faculties ranking higher than world-famous universities across the world, while tuition is relatively low. Students from EEA (European Economic Area) countries, Switzerland and Surinam pay a tuition fee of €2,143 (academic year 2020-2021), while students from other countries pay between €6,000 and €15,000 for a bachelor’s degree, and between €8,000 and €20,000 for a master’s degree. Compare that to, for instance, $26,000 – $36,000 per year in the US (for non-state residents) and $10,230 for state residents.

International Students

There are almost 86,000 non-Dutch nationals in the Dutch universities, from 170 countries, 27% of which are outside Europe. When it comes to bachelor’s degrees, 53% of the international students go to a research university and 47% to a university of applied sciences. While the percentage of international students is 11.5 of all students in the Netherlands, they constitute 23.6% of all students obtaining a research university master’s degree.

You’ll notice just how international the Dutch universities are when you visit their so-called open days, where you can follow short classes, meet current students and obtain information about the courses. The pamphlets are available in English, many of the introductory classes are given in English and, among the current students grabbing a bite to eat in the cafeteria, English appears to be the main language – if only because in every group there’s at least one student who doesn’t speak Dutch.

Two Types of University

The higher education system in the Netherlands is based on a three-cycle degree system, consisting of a bachelor’s, master’s and – if you want – Ph.D. degree. It is offered at two types of institutions: research universities (WO / universiteit) and universities of applied sciences (HBO / hogeschool).

Research Universities

Academic education (universiteit) is offered to students with an IB-Diploma or the Dutch VWO – or their equivalent – by universities in Maastricht, Eindhoven, Tilburg, Nijmegen, Wageningen, Enschede, Groningen, Utrecht, Amsterdam, Leiden, Delft, and Rotterdam. Some of these universities also have faculties / departments in other cities.

The university degree programs are organized around a bachelor’s or undergraduate phase that lasts three years and a master’s or graduate phase that lasts one to three years. These universities offer research-oriented programs (Wetenschappelijk Onderwijs, WO) and the possibility to conduct research in a wide range of disciplines: language and culture, behavior and society, economics, law, medical and health sciences, natural sciences, mathematics, engineering, and agriculture.

As many Dutch universities have partner institutions in other countries, students can follow part of their degree program course abroad. Your university can tell you with which universities it has an exchange agreement.

Hogescholen or ‘Universities of Applied Sciences’

Universities of applied sciences offer higher professional education (Hoger beroepsonderwijs, HBO), which focuses on applied arts and sciences in one of the seven HBO sectors: agriculture, engineering and technology, economics and business administration, health care, fine and performing arts, education / teacher training, and social welfare.

The universities of applied sciences offer four-year bachelor’s degree programs as well as master’s programs lasting one to two years. All degree programs focus on preparing students for particular professions. They tend to be more practically-oriented than programs offered by research universities. In addition to lectures, seminars, projects and independent study, students are often required to complete an internship or work placement (stage) which normally takes up part of the third year of study, as well as a final project or a major paper in the fourth year.

International Education

Next to the research universities and universities of applied sciences, Holland has a third and smaller branch of higher education, officially known as ‘International Education’ (IE). International education offers advanced training courses, taught in English, originally designed for people from developing countries whose jobs require highly-specialized knowledge. Most of the IE institutions are part of a research university and focus on courses relevant to developing countries.

There are almost 86,000 non-Dutch nationals in the Dutch universities, from 170 countries

Finding a Study Program Here and Abroad

The site www.studyfinder.nl offers international students an independent and reliable overview of international study programs offered by the Dutch higher education institutions, ranging from short training seminars to full-fledged bachelor’s and master’s degree programs. On www.scholarshipportal.com you will find an overview of the financial support available from many different sources for those who want to study in Europe.

Requirements for Admission to Higher Education

For access to WO bachelor’s programs, students are required to have an IB diploma, a VWO diploma or – in some cases – to have completed the first year (60 ECTS, see further on) of an HBO program. The minimum access requirement for HBO is an IB-diploma (and, in some cases, the IGCSE-diploma with two additional subjects at GCE-level), the Dutch HAVO / VWO diploma or a level-4 MBO-diploma. Students with four GCSEs with marks ranging from A*-C, plus two GCEs at A/S level are also eligible for admission. Potential students older than 21 years of age who do not possess one of the qualifications mentioned above can qualify for access to higher education on the basis of an entrance examination and assessment.

To determine whether your diploma qualifies, if you have a non-Dutch secondary school diploma or an IB diploma, you must have your diploma evaluated by your prospective educational institution.

Institutions may have additional admission requirements. You first need to find a study program and then check its particular admission requirements, and if there are any additional ones. To follow an English-language course, you must speak, read and write English well, and you will be required to show that you have passed an English language test. IELTS and TOEFL are commonly accepted, but institutions may accept other tests as well, such as Cambridge English.

Deadlines and DigiD

If you want to study in the Netherlands, keep an eye out for the application deadlines. In some cases, for instance numerus fixus study programs, this is January 15. For most other study programs, it is May 1. With some universities, you need to apply via the Studielink website – so be sure to check with your prospective study program whether this is the case for you. In order to register via Studielink, you will need a DigiD – this is a digital identity used to arrange certain things online, such as taxes, healthcare, insurance, etc. You request a DigiD online – for which you will need another of those Dutch acronyms; a BSN (burgerservicenummer, or citizen service number), as well as a mobile phone number and an email address. After about five days, you will receive a letter by mail with an activation code – so be sure to take this into account when preparing to register!

Associate’s Degree

The associate’s degree (it goes by the same name in Dutch) program is a two-year ‘short cycle’ degree program offered by universities of applied sciences. It enables students to obtain a professional qualification in a shorter period of time and can help them learn the skills and competencies needed to improve their chances on the job market. Access requirements to an associate’s degree program are the same as for an HBO bachelor’s program (they don’t accept all MBO diplomas, however). Once they have obtained an associate’s degree, graduates can seek employment or continue in the last two years of an HBO-program, to obtain a bachelor’s degree.

International Secondary Vocational Education

There is a network of bilingual MBO schools in the Netherlands, currently consisting of 40 schools. At a bilingual MBO school, 50% of the curriculum is taught in English. Students who graduate from a bilingual MBO school are obligated to obtain an internationally-acknowledged diploma or certificate such as BTEC, BULATS, Cambridge or Anglia. Another important part of bilingual education is the focus on international awareness in the curriculum, for instance through international internships or projects. At the moment, there are several MBO schools that offer full degrees in English, like ROC Mondriaan and the Summa College. Other schools in the Netherlands are extending their curricula with international courses, like ROC Amsterdam, where students can follow an intensive one-year international course in denim development.

European Business Baccalaureate Diploma

Recently, a new program has been developed: the European Business Baccalaureate Diploma (EBBD), which is recognized all across Europe. The program focuses on business competence and soft skills in an international environment, for professions in the area of business administration. In the Netherlands, the Summa College in Eindhoven, Koning Willem I College in Den Bosch and ROC Midden Nederland in Utrecht offer this program. For more information check www.eurobacdiploma.eu.

Choosing a University

The Dutch system of quality control guarantees that the education offered at all the institutions meets the same high standards. When Dutch students choose where they want to study, they are not thinking of which research university or university of applied sciences is best, but instead are looking at which specializations are offered and which emphasis or academic tradition is featured. On www.studyfinder.nl you can search and compare English-language study programs based on the criteria that matter to you.

How do you know for sure that your course or program is of the right quality? Find out whether it has been accredited by the Accreditation Organization of the Netherlands and Flanders (Nederlands Vlaamse Accreditatie Organisatie, www.nvao.com), which has been appointed by the Dutch and Flemish government for the purpose of monitoring the quality of the higher education courses and programs on offer. All Dutch higher institutions that you will find on www.studyfinder.nl have signed the Code of Conduct. Find out more which institutions have signed the Code of Conduct on www.internationalstudy.nl.

Making the Transition

In principle, if you want to come to the Netherlands as a student, you can only come here to follow a particular course (or full study program) and you must meet all requirements. There are, however, three exceptions to this. The first is: if you meet all requirements for studying in the Netherlands, you are allowed to come here for a year first to study Dutch. The second is: if you do not meet all requirements, you can come here for a year to follow a preparatory program for the particular study of your choice. The third option is the so-called foundation year (schakeljaar); a transitional year that has been created for specifically for non-European, non-Western students to help them prepare for their studies here.

Studiefinanciering

Based on studiefinanciering rules, students starting in September 2020 can take out a maximum loan of € 1,076 (including a tuition fee loan). If you have a right to the studiefinanciering-loan, you also have a right to the Studenten OV-chipkaart, with which you can travel by public transportation for free either during the weekend or on weekdays (your choice) and at reduced rates during the other days. This public transportation pass is subject to the condition that you complete your studies within ten years.

If you are a non-Dutch national, legally residing in the Netherlands, you can apply for the studiefinanciering-loan if:

· you are enrolled in a recognized, full-time or dual course of at least one year

· you are an EU/EEA/Swiss national and lived in the Netherlands for five consecutive years with a maximum interruption of six months, or if you (or your non-Dutch parent or partner) did

· you have a type I, II, III or IV or V residence permit.

DUO strongly advises foreign EU-students (if you have not been living in the Netherlands for five consecutive years or more) to contact one of their support offices. They can provide you with further information. EU/EEA/Swiss nationals who do not qualify for the studiefinanciering-loan, can apply for a tuition fee loan, to be repaid upon completing their studies, for more information, visit www.duo.nl.

Useful links
www.studyinholland.nl – for information on requirements, tuition fees, scholarships, etc.

www.nuffic.nl – for information on the education system, diplomas, etc.

www.duo.nl – for information on the student grant

www.uaf – for refugees looking to study in the Netherlands

To Be or Not to Be a Father

By Edith van Ruitenbeek

What does ‘being a parent’ mean? What do custody or parental responsibility entail? For instance, do you have a say in the choice of school for your children? Especially for unmarried expat parents, the answers to these questions are not simple.

If an expat father wants to create the best conditions for his children to grow up safely, with the health care and education he considers to be the best, the best thing he can do is make sure that he has a legal say in this.

Are You the Parent?

In the Netherlands, at least at the moment, the woman who gives birth to a child, is considered this child’s mother and automatically has parental responsibility. This might change, however, as new legislation is in the make regarding surrogacy.

If the biological father is not married to the mother, nor has entered into a registered partnership with her, then he is not considered their child’s parent, at least not from a legal point of view. Pursuant to Dutch law, this can be ‘repaired’ by having the father recognize the child at the municipality or by notarial deed, provided the mother agrees to this – in which case, a DNA test is not required. When foreign law is applied, the rules might be different.

If the mother does not cooperate, the father can request permission from the court to recognize the child. In this case, the first thing to take into account is which national law applies. Dutch law states that, in this type of situation, the court might request a DNA test and request the mother to cooperate.

If the biological father does not want to recognize the child, or if it is considered important to establish paternity from the day of birth, the court can be asked to establish this by means of a DNA test – unless it regards a situation in which the applicable law does not offer this possibility. This request can only be made by the mother (within five years of the birth of the child) or the child. Not by the father! The father can give his permission beforehand, though. Further rules and regulations on this matter can be found in the applicable legislation.

For the sake of the children parents are advised to arrange joint parental responsibility when the relationship is still good

Unmarried Parents

As a family lawyer with an expat practice, I regularly meet expat families in which paternity has not been established, particularly for the eldest child. This is often because the parents were not married at the time of birth and forgot to do about recognition of the child. For instance, one couple had to move to another country for job purposes, and simply did not have enough time to arrange recognition of the child in the country of birth.

In another case, the parents were married and living in the Netherlands – but only registered with the Ministry of Foreign Affairs. Because the father had been abroad on a mission when the mother gave birth, and the civil servant had had no means to verify that the mother was married, while the child had also not been recognized by the father in any other way, he was not willing to mention any man as the father on the birth certificate. As the parents had three different nationalities among them and had gotten married in a fourth country, some research had to be done to determine the applicable law before a request could be made to have the birth certificate and the name of the child amended.

Parental Responsibility

From a legal point of view, being a father does not mean you also have parental responsibility. At least, according to Dutch law, not when the father is not married to the mother. Belgian law, for instance, has different rules and does give the unmarried father parental responsibility.

If the legal parents are not married and do not have joint parental responsibility, this can be fixed easily – provided both parents cooperate. It can even be arranged online if the child was born in the Netherlands.

In times of crisis, the father can file a request with the court to establish joint parental responsibility. In these situations, however, the children are often ‘caught in the middle’. As this should preferably be prevented, for the sake of the children, parents are advised to arrange joint parental responsibility while the relationship is still good.

Referring to the Convention of the Rights of the Child (UNCRC), requests filed before a Dutch court regarding fatherhood or joint parental responsibility are likely to be honored, under ‘normal’ circumstances. This is because a child has a right to grow up knowing who his parents are and to be in contact with them.

Edith van Ruitenbeek is a lawyer and partner at van Hilten Advocaten & Mediators, Nassaulaan 15, The Hague and De Lairessestraat 129, Amsterdam.

www.vanhiltenadvocaten.nl

Patchwork Family

By Yolanda Bokhorst

‘Patchwork families’ are families made up of parents and children, whereby one – or both – of the parents has brought in a child from a former relationship. Sometimes these parents also have joint children.

Almost 10% of all families are patchwork families. And this is only expected to increase. The relations within such a family are often complex. The children have to get used to the new family and the step-parent and – vice versa – the step-parent has to build a relationship with the step-children.

New Situation

Some families are together full-time, others part-time, half-time or during the weekends – sometimes in combination with shared parenting. To some, these new families feel like an enrichment, but there are also plenty of cases in which the newcomers are seen as interlopers or in which conflicts of loyalty arise. Whatever the case may be, it is always good to look into the legal consequences of the new situation and to put things on paper.

Having a Say over the Children and Expenses

The premise in Dutch law is that the legal parents share parental authority (the right and duty to raise and take care of the children) over their joint children. Whether or not these parents are in a relationship is of no importance. A step-parent has no parental authority. If the step-parent and the parent are married or have entered into a registered partnership and the step-child is part of the family, then the step-parent is obligated to contribute to the costs of sustenance and in the raising of the child. How much, depends on the circumstances.

Pursuant to the European Convention on Human Rights, when the relationship between the step-parent and the parent comes to an end, the step-parent can request visitation rights. Any obligation to contribute to the sustenance, however, ends.

International

The rules described above also apply in international situations in which the child has their habitual residence in the Netherlands. If the step-child and step-parent share a nationality, the step-parent can lodge an objection against the obligation to contribute to the child’s sustenance if the law of this country of shared nationality does not contain this obligation.

Inheritance

Pursuant to Dutch law, step-parents and step-children do not automatically inherit from each other. In the Netherlands, inheritance takes place on the basis of blood relationship. The only exception to this is the spouse or registered partner.

Should you want to leave something to your step-child, you will have to arrange this in a will. There are a variety of options; you can give your children and step-children equal status, you can leave your step-child a certain amount or percentage of the inheritance, or you can determine that your step-child is a joint heir for a particular share.

Does this section of Dutch inheritance law also apply to expats who live here?

International Inheritance Law

Since August 2015, the Inheritance Law Regulation applies in the entire EU, except for Denmark (and, insofar as still relevant, the United Kingdom and Ireland). This regulation states that the law of the last country of residence of the deceased applies to the entire estate and its settlement, including assets that are located in another country.

In other words, should you pass away while living in the Netherlands as an expat, then Dutch inheritance law applies to your entire estate. Unless, in your will, you have determined that the law of your country of nationality applies.

Married, With (Step-)Children and No Will?

Then, in the Netherlands, the rules on intestate succession apply. This means that your (legal) children and spouse are joint and equal heirs. All your possessions and debts go to your surviving spouse, whereby the children have to wait for your spouse to pass away or become bankrupt in order to claim their portion. Before that, they cannot claim their portion, while the spouse can use up the entire inheritance. Step-children do not receive anything, but they can inherit from their own parent.

Especially when the surviving spouse is not the actual parent, these rules can lead to some undesired outcomes. Which is why, particularly in the case of a patchwork family, it is wise to draw up a will that contains arrangements for the own children, step-children and surviving spouse – both upon the death of the first spouse as well as upon the death of the surviving spouse.

Pursuant to Dutch law, step-parents and step-children do not automatically inherit from each other

Not Married, (Step-)Children and No Will?

In this case, only the own children will inherit. If you live together, but are not married or have not entered into a registered partnership, you will not automatically inherit from each other. In order to protect your partner, you should draw up a will. This will should contain provisions clarifying the position of the surviving partner, the own children and the step-children. Generally speaking, a cohabitation agreement will be necessary in order to strengthen your partner’s position.

Inheritance Tax

If you pass away while living in the Netherlands, then Dutch inheritance tax will be levied over your worldwide estate. The lowest rate applies to children and the spouse. The good news is that, if they are included in your will, your step-children will also be subject to the lowest rate.

Drawing Up a Will

Taking into account the complicated situations that may arise in (international) patchwork families, you are strongly advised to draw up a will determining who will be your heirs and taking into account the sometimes sensitive relations between step-parents, own children and step-children. To do this, it is best to contact a civil law notary who is specialized in international inheritance law. In the Netherlands, only a will that has been drawn up by a civil law notary is legally valid. You will have to visit the civil law notary in person to sign the will.

Financial Considerations Surrounding Finding a Home

One of the most important issues involved with buying a house – in fact without these you could not buy one – is finances.

You either have to be able to rent a home, buy it, or finance it and there are certain tax issues to be taken into account, as well.

Renting a Home

Renting a house in the Netherlands is expensive, especially if you need to rent in the western part of the country or close to international schools. There is no tax facility for renting a house whatsoever. With any luck, your employer will choose to compensate you for the housing costs. But in that case, be aware of the tax consequences, see the following paragraphs:

Free Housing Taxable

If you are a resident of the Netherlands (resident taxpayer or partial non-resident taxpayer), any compensation for housing provided by your employer constitutes taxable income. Whether you will have to pay the tax yourself depends on your contract; is it net or gross?

If you are a ‘real’ non-resident taxpayer, you may benefit from an exemption during a period of two years, under certain conditions.

Special Treatment Under 30%-Ruling

Residents

If you are a resident of the Netherlands (also if you are a partial non-resident taxpayer), in principle the full benefit resulting from the fact that your employer is providing you with housing is a taxable benefit.

If you benefit from the 30%-ruling, special rules apply. A part of the rent may be qualified as an ‘extraterritorial expense’. That part of the rent can be compensated free of tax (thus reducing the amount of the fixed 30%-allowance!)

Non-Residents

If you are a non-resident of the Netherlands, any compensation of double housing expenses is regarded as compensation for extraterritorial expenses: tax-free, but resulting in a reduction of the 30%-allowance.

Buying a Home – Taking Out a Mortgage

If you have decided to buy a house, you are faced with the question of what will be the most appropriate type of mortgage. The recommended mortgage depends on your special tax position and whether you are likely to move again. In these paragraphs we provide a brief explanation of the relevant types of mortgages available in the Netherlands – whereby we point out that if you take out a new mortgage, you will only be allowed to deduct your mortgage interest from your taxable income if you take out a mortgage with straight line redemption or an annuity mortgage. We will also give a few recommendations as to which types are best suited to your specific tax status.

Usually a mortgage has a duration of 30 years. Here, we will discuss the three principal types of mortgages and give a brief summary of the mortgages that can no longer be newly taken out.

Mortgage With Straight Line Redemption

The most important characteristic of this mortgage is that the loan is repaid yearly in equal installments (i.e. straight line). As a result of the repayments, the amount of interest payable diminishes every year. Since the interest expenditure decreases steadily, this mortgage is best suited for borrowers who cannot fully benefit from the tax relief on the interest payments.

Annuity Mortgage

The chief characteristic of an annuity mortgage is that the yearly total of redemption and interest payments remains the same throughout its duration. Although the total remains the same, the mix of interest and redemption of course changes over the years. Owing to this balance between interest and redemption, the redemption is not on a straight line basis.

In the first years, the amount paid by the borrower consists mainly of interest payments. Hence there is a large tax relief in the initial years. Consequently, an annuity mortgage is ideal for people who wish to have a large tax relief in the early years and expect to have a sufficiently high income in later years to be able to make the redemption payments that do not qualify for tax relief.

Nationale Hypotheekgarantie (NHG)

With a Nationale Hypotheek Garantie (National Mortgage Guarantee), the Stichting Waarborgfonds Eigen Woningen (Homeowners’ Guarantee Fund) guarantees payment of the mortgage. In return for this you pay the NHG a one-time fee (0.7% for 2020). If you cannot meet your payments, NHG pays them for you – and becomes your creditor for this amount. The advantage to this system for the mortgage provider is that they are guaranteed payment, in return for which they offer a reduction in mortgage interest of anywhere between 0.3 and 0.7% (in some cases, even 0.9%).

An NHG mortgage loan can be taken out to a maximum of € 310,000 (2019), or 6% more if you take special measures to reduce energy expenses.

Other Mortgages

With the following mortgage types you will no longer be allowed to deduct the related mortgage interest from your taxable income. For this reason, they are basically no longer offered. If you already have one of these mortgages and lower your mortgage interest, or change mortgage providers, you can keep it – including the deduction. These mortgages are:

Endowment mortgage: No repayments are made during the term of the mortgage. Instead, the whole loan is redeemed in a single lump sum at the end of the term.

Special endowment mortgage (Spaarhypotheek): This is a variation on the Endowment Mortgage. It too provides for a lump-sum redemption of the mortgage loan at the end of the term, with an interest rate on the loan equal to the gross rate of return on the investment under the endowment policy.

Banksparen mortgage (SEW): A special savings or investment account is linked to the mortgage, and the savings must be used for paying off the mortgage.

Interest-only mortgage: No redemptions take place during the term of the mortgage. It is usually part of an ordinary Endowment Mortgage.

Dutch Tax Issues For Expatriates

In essence, a mortgage is a tax-driven product. Hence, to determine the most appropriate type of mortgage for you, it is necessary to first consider your tax status. In the Netherlands, the two major tax issues with which an expatriate is faced are the 30%-ruling and the choice between resident (binnenlands belastingplichtige) and partial non-resident tax status (partieel buitenlands belastingplichtige).

The 30%-Ruling

Simply put, the 30%-ruling allows an employer to grant an employee a tax-free allowance of up to 30% of his total remuneration to cover expenses related to his placement abroad that he would not have had had he not been sent abroad – such as, for instance, housing-related expenses. Your total gross remuneration is reduced by 30% and in return you receive a 30% tax-free allowance. The result of the 30%-ruling is a higher net salary. When applying for the 30%-ruling, the employee may choose to have resident or partial non-resident tax status, see the following paragraph.

Partial Non-Resident Tax Status

Expatriates who are partial non-residents owe taxes on income derived from certain sources specifically stated in the Dutch income tax legislation.

Partial non-residents are also entitled to tax deductions insofar as they relate to specific income sources, alimony payments and mortgage interest payments for their principal place of residence.

A final important observation regarding partial non-residents is that, contrary to resident taxpayers, their net wealth (i.e. assets minus liabilities, taxed in box 3, over a ‘fictitious’ yield, at 30%) is not taxed here. Hence, the ideal mortgage for a partial non-resident takes advantage of the fact that the interest payments on the mortgage are tax-deductible and that the investment income is not taxed. The corresponding mortgage is discussed further on.

Resident Tax Status

Unless an expatriate chooses to be treated as a partial non-resident taxpayer, he is viewed as a resident for Dutch tax purposes. He is then taxed just as any ordinary Dutch citizen. Resident taxpayers (as well as partial non-resident taxpayers) are only entitled to mortgage interest relief on the principal place of residence. The value of every other residence is subject to wealth tax (over, in principle, the fair market value of the property minus the mortgage loan – over a fictitious yield, at a rate of 30%). Whether this also applies to a house abroad depends on whether this is dealt with in a tax treaty between the Netherlands and the country in which the house is situated.

Expatriates: What Mortgages Are Appropriate?

The recommended mortgage depends on your special tax position and whether you are likely to move again.

The ordinary and the Special Endowment Mortgage are not appropriate for a number of reasons. This has to do with the likely duration of your stay. If you leave within, say, seven years and upon leaving decide to surrender the endowment policy, you may receive back only the total of premiums paid. The reason why there will be hardly any investment return is that insurance companies write off all policy costs during the first years of the insurance. Hence, if you surrender within this write-off period, the investment return will only be marginal.

Most expats opt to pay off the mortgage amount (either through an annuity or straight line mortgage), or to accrue the related amount on a savings account – on a special ‘Own Home Bank Savings Account’, or SEW, see earlier on – and sometimes they opt for an investment mortgage (investment account linked to a mortgage). The redemption-free mortgage is also a reasonably popular option. Generally speaking, mortgages that are linked to insurances are no longer taken out, especially not by expats.

You Are a Resident Taxpayer

If you are benefiting from the 30%-ruling, this will mean that you have a high net salary. This will enable you to make repayments. At the same time, income from wealth is tax-free. For that reason, barring special circumstances, repaying the loan will usually not be tax-efficient.

You Are a Partial Non-Resident Taxpayer

In this case you need to find a mortgage which allows you to benefit from the tax-deductibility of the interest payments while at the same time allowing you to benefit from the tax-exempt investment income (since there is no ‘wealth / box 3’ tax for partial non-resident taxpayers). A special type of mortgage can be found, allowing you to fully benefit from these advantages: a redemption-free mortgage combined with a compulsory savings scheme. Since there are no repayments, you benefit to the full from the tax-deductibility of the interest payments.

And since the investment income on the savings scheme is not taxed, you can use this to generate capital with which all or part of the mortgage can be repaid once your partial non-resident tax status ceases to apply. Because the savings are not taxed, it is better to save than to make repayments: the after-tax effect of the repayments will usually be lower than the tax-free effect of the savings. It follows that it is advisable to borrow as much as possible provided that it can be demonstrated that the funds are used for the acquisition of immovable property in the Netherlands. Finally, as partial non-resident taxpayers benefit from the 30%-ruling; here too this allows you to make savings.

U.S. Taxpayers

Special provisions apply to U.S. taxpayers; these are not covered here, but can be discussed with your tax advisor.

Economical, Not Stingy

By Chris Smit

Most of the work I do consists of giving 1 or 2-day workshops and giving lectures (anything between 20 minutes to 2 hours, I consider a lecture) about cultural differences. And to ‘ease’ the delegates into to the subject of culture, I start talking about stereotypes; which are, of course, an incomplete representation of reality or a society. Sometimes they are true and sometimes they’re not true. Sometimes they’re in between.

Of course, I ask about what stereotypes people hold about the Dutch as well. Here are some: bikes, orange, marijuana (almost always immediately followed by the Red Light district in Amsterdam), cheese, and many more. And also always the word stingy or cheap (sometimes reluctantly or quietly, because they are afraid to insult me. Trust me, you can’t insult a Dutchman. We’ll insult you, though, or at least be rude to you, albeit unwillingly).

And so the word is out; the Dutch are stingy. But are they?

Are the Dutch Stingy?

When the people in my workshops tell me the Dutch are stingy, I tell them that it’s is not true. Instead, I tell my audience that the Dutch are… well, economical… Which almost always makes them laugh. But listen to my defense:

The Dutch, per head of capita, give more to good causes (such as a relief fund aimed at helping the victims of a hurricane disaster) than any other country in the world. Compared to our neighbors in the south, the Dutch, on average, give about three times as much as the Belgians. Using another source on this topic, the World Giving Index, the Dutch rank a respectable 13th place (source: https://en.wikipedia.org/wiki/World_Giving_Index). Germany holds the 21st place, Belgium the 32nd place, and France holds position number …81.

For this poll, the following questions were asked: “How often have you…”

helped a stranger, or someone you didn’t know who needed help?
donated money to a charity?
volunteered your time to an organization?

The Dutch, per head of capita, give more to good causes than any other country in the world

Shops

Furthermore, the Dutch don’t have cheap shops either. There are many Dutch shops, that can also be found in Belgium, Germany, and France, that are economical, but not cheap. Here are some examples:

C&A (sells clothes)
Zeeman (sells clothes and assorted household items)
Kruidvat (sells anything from deodorant, candy, to protein powder)
HEMA (do you know what this abbreviation stands for? Hollandse Eenheidsprijzen Maatschappij, roughly translated: Single Price Company)
Blokker (sells random household stuff; but never what I need…)
Action (one of the recently most successful retailers from the Netherlands; they sell anything from light bulbs to towels to protein powder as well).

…To name a few.

These stores sell things that are reasonably priced and of reasonable quality. Which is different from selling cheap stuff.

From a Cultural Perspective

From a cultural perspective you could argue that these types of stores thrive here due to the Calvinistic nature or culture of the Dutch – who don’t do things that are over the top, work to live instead of the other way around, and believe in quality of life over quantity.

The Scandinavians even have a virtual law for this: “The law of John”. Whereby John shouldn’t think he’s better, more, richer, or above anyone else. The Dutch don’t use this saying, but do act accordingly. Which explains their love for economic shops mentioned before; why spend more when you can buy something of reasonable quality, for a good price?

Some Related Comparisons

If you look at the countries that surround us, Belgium and Germany, you will notice that overall, the houses in the Netherlands tend to be smaller. As well as the cars we drive; after all, a small car will get you where you want to go as well, so you don’t need a big car…

From a cultural perspective, the Dutch follow the same trend as the Scandinavian countries. One good example of an international success is IKEA. Reasonable to good quality stuff (who has an IKEA-free house?), for a reasonable price.

So, be honest; why pay more if you don’t have to?

ABOUT THE AUTHOR

Want to better understand the Dutch and learn how to work with them? Get in touch with Chris Smit at culturematters.com or send an email to chris.smit@culturematters.com.

How to Meet Locals in Amsterdam

Being far from home in a foreign city or country can be one of the hardest things that a person can face. Imagine having no friends to talk to? However, if you are new to Amsterdam, there are several ways in which you can meet the locals.

Many people who go to visit foreign cities and countries usually have the tendency of keeping to themselves. I have some news for you though! Staying holed up in your accommodation in Amsterdam all day long will only hinder you from experiencing what the city has to offer.

Get out, meet some locals and make a few friends and you will be guaranteed to have a much enjoyable stay in Amsterdam. You might be wondering how to go about meeting the locals, right?

Read on as we discuss some of the ways in which this can be achievable.

Join a Local/International Organization

You will find that Amsterdam has a lot of these organizations that you can join. Many of these organizations are formed based on interests.

You can find some that interest you, and you will be surprised to meet many people who share your passion.

Do not be afraid to interact and to know more people

Be Social

There are many global communities for expats whose main aim is to help you feel at home regardless of where you are.

Joining groups such as Internations, Meetup and other expat forums and Facebook groups is also a nice way to meet locals and other foreigners living in Amsterdam.

Party With a Local

Amsterdam locals are hugely known for their free-spiritedness. If you are the quiet type that likes keeping to himself, maybe it is time to loosen up and discover the beauty of partying with a stranger.

Take advantage of the friendly nature of the locals and do not turn down an invitation to go partying. Who knows, that stranger can turn out to be the friend that you need.

Learn Dutch

There are some regular language classes that you can take up to help yourself settle in. Having basic knowledge of the local language also helps you navigate easily when it comes to things such as greeting the locals, ordering coffee and even your shopping sprees are made much easier and enjoyable.

Making an effort to learn the local language will also help you to communicate more easily with the locals hence making new friends.

Enjoy The City Life

Considering that Amsterdam is one of the cities that bustles with life, going for walks along the city streets is also another way to meet with the locals.

Staying silent and clamming yourself up will not help you to make new friends. Therefore, make sure to strike conversations as you take your walks around the city.

Do not be afraid to interact and to know more people, this way, you will end up making more friends.

Conclusion

Whatever reasons you may have for visiting Amsterdam, just do not stay holed up in your house.

Go out, meet locals, keeping in mind that the more people you meet and the more friends you make, will make your visit to Amsterdam even more exciting and unforgettable.

Mortgage, Liability and Marriage

You must be wondering: what’s the connection between the words in the title? I can assure you; more than you would expect. Allow me to explain.

Home – Mortgage

When you buy a house without having the amount of the purchase price, expenses and taxes in your bank account, you will need to arrange a loan with a bank. And because the bank does not necessarily have confidence in the fact that you will be able to repay your loan, they will ask for some form of surety – being a mortgage right on the house you will be buying. Furthermore, the bank will first thoroughly check your personal situation, such as: how much income you earn, whether you are married, what your career perspectives are, whether there are any other financial obligations, etc. Plus you will need a residence permit and a BSN (burgerservicenummer, or citizen service number – for tax purposes). If the bank decides to give you the green light, then you will be issued a mortgage loan. The civil law notary will draw up a mortgage deed, which will be signed at the same time as the transfer deed of the home.

Until now, nothing new.

What If You Are Married?

Often, married couples decide to buy a house together and to share the responsibility for the repayment of the mortgage. Their position, when it comes to ‘property’ and ‘debt’, is equal.

When one of the partners pays off more of the debt or invests more in the home, then this should be put in writing. After all, if you are both 50% owners, then you should contribute 50% to the expenses. If you don’t share the expenses in this way, then one partner ends up with a debt towards the other – which should be settled once the home is sold or the relationship is terminated. Particularly in the case of divorce, this type of situation can lead to conflict. The more you put in writing, the more you avoid this type of situation.

It is clear that if the home is put in the name of only one of the partners, while they are both liable for the mortgage debt, this can lead to a skewed situation. The ‘ownership’ is not shared, but the ‘debt’ is. More often than not, this is not what the partners had in mind.

In this context, I would like to point out that most banks require both partners to be liable for the debt. Should you want to arrange this differently, then be sure to bring this to the table as early as possible in the process. Make sure that the bank will agree to having the mortgage debt solely in the name of the person buying the home. This is of particular relevance if there is no community property between the partners.

Most banks require that both partners are liable for the mortgage debt

Community Property or Not?

If you are married in community of property then, consequently, both the home and the mortgage debt could become part of the community, regardless of whether they are in name of one or both of the partners.

Until January 1, 2018, general community property was the norm when it came to the Dutch matrimonial property regime. As of that date, to all marriages entered into after that date, a regime of limited community property applies.

This can be avoided by entering into a prenuptial agreement. In order to ensure that third parties (such as the bank issuing the mortgage) are aware of this prenup, and therefore of the fact that there is no community of property, this prenup should be registered with the court.

Foreign Law

Non-Dutch expats who live abroad, get married abroad and then move to the Netherlands (with or without a family), are – in most cases – not automatically covered by Dutch matrimonial property law. But – then which matrimonial property law applies? Does the foreign law also contain community of property or do the spouses retain their own property after marriage? Did the spouses draw up a prenup abroad? And how do third parties in the Netherlands – take, again, the bank issuing the mortgage – know what has been arranged pursuant to this foreign law?

Statement

Recently, in our practice, we have been receiving requests to issue a statement declaring which matrimonial property regime applies to the expat who is requesting a mortgage in the Netherlands. This is not a ‘copy-and-paste’ type of statement – to the contrary. Determining which law applies is often a complicated process, meaning that it can be quite time-consuming and costly. And once it has been determined which law this is, the Dutch civil law notary cannot make any statements regarding its contents. Advice will have to be sought abroad. In short, it takes time and money to provide the bank with clarity on the matrimonial property regime.

Something which you may not have once you initiate the mortgage negotiations…

Determining which law applies to your matrimonial property is often a complicated process, meaning that it can be quite time-consuming and costly

Advice

Are you married and planning on buying a home in the Netherlands and requesting a mortgage? Then be sure to prepare for questions regarding your matrimonial property regime. Make sure you know which law and which regime apply.

How do you do this? By choosing an applicable law when drawing up a prenup. You can do this once you are married, but even better would be to do this before getting married. This will help you avoid a lot of problems.

In the Netherlands, the civil law notary draws up the prenup. A civil law notary who is specialized in international matrimonial property law can give you further advice on the matter.

Utilities in the Netherlands

Don’t you love those cozy winter evenings, when you’ve taken a warm shower, made yourself a hot cup of tea, turned on the light and crawled into your comfy bed in a nice, warm bedroom? None of that would be possible without the services of a utility company.

So, how do you go about arranging your utilities in this country?

You start out by visiting a site such as www.gaslicht.com or www.independer.nl – which offer an independent overview of all suppliers – or www.energievergelijken.nl/en, which offers the same information in English. You type in your postal code, your house number and select your current supplier. This list contains all the suppliers in the Netherlands as well as the options onbekend (which boils down to ‘don’t know’), geen i.v.m. verhuizing (‘just moved, don’t have one yet’) and verschillend voor gas en stroom (‘different one for gas and electricity’). At the top of the list of suppliers are the three biggest companies of the moment.

Next, you can fill in your annual use, or – as you probably don’t know this yet, as you’ve just moved here – the number of people in your household. You can also indicate whether your house has solar panels. This will give you an approximation of your use; only a year later will you of course know the actual numbers.

On the next page, you will find an overview of the various offers, plus the option of selecting 100%-sustainable (‘green’), 50% sustainable or 0% sustainable energy, the duration of the contract and whether you want fixed or variable rates.

Based on your (actual or estimated consumption), you will find a list of offers of monthly (or annual) amounts that you will pay the various companies for the utilities they supply. A number of issues to look at when comparing these offers are

The per-unit cost of gas
The per-unit cost of electricity
The delivery (administrative) costs of each of these; a low per-unit cost may be neutralized by high delivery costs
Any introductory (‘welcome’) rebates the company may have to attract new customers.

On the page with the overview, you can select three companies in order to compare their prices. Here you can take a closer look at the items mentioned above: per-unit price, delivery costs, and welcome rebate.
At the end of the year, you will receive an overview of your actual use. If you exceeded the calculated use, you will owe the additional amount, if you stayed below it, you will receive a refund. The company will also determine what you will owe per month over the next year, which they will base in part on your past use and in part on expected price developments (unless you’ve opted for a fixed rate). However, you are not held to this amount; online – once you have created an account – you can adjust this monthly amount upwards or downwards. Of course, adjusting it downwards creates the risks of owing the excess amount – should there be one – in one go at the end of the contractual year.

Tip
Get a quote for your utilities from Ampeer in a few easy steps

Keep in mind that some of us like to keep it toasty and warm all day long, and throughout the house. Not so the Dutch. Many of them sleep with the windows open at night (even in the winter), and turn off the radiators in certain rooms, or during certain hours. This means that the monthly price quoted for a four-person household will probably be lower than what you will personally end up using. Consequently, you might want to raise your monthly price, or be psychologically prepared to pay a substantial difference at the end of the contractual year.

Don’t forget to request a ‘smart meter’ (slimme meter) to be installed in your house. This will allow you to set up your own schedule, depending on your family routine. It will also allow you to monitor your daily use of both gas and electricity, as well as – if you really have time to spare – the amount of electricity certain gadgets use (an electric water boiler for your tea generates an impressive spike!). The services offered by the smart meter depend on the utilities company and it is worthwhile to know that if you switch to a different utilities company, you might no longer be able to make use of all its features (programming will always be possible).

As for the contract period; you can opt for a one-year, two-year, three-year, four-year or five-year contract – the longer the duration, the lower the price. This makes some people nervous; they would rather pay a little more and be able to switch after one year. Maybe you, being new to the country, would like to take this route too. If you do opt for, say, a three-year contract, then you will owe a fine if you make an early switch (for instance, more than three months before the end of the contract). Often, your new supplier will offer to pay this fine for you, but be careful about making a switch after the winter. The monthly amount you pay is an average, meant to cover the more expensive winter months, and the cheaper summer months. If you switch in March and are more or less halfway your contractual year, then your monthly payments will not cover your actual expenses and you could find yourself paying several hundreds of euros more – which your new supplier will not cover. A little tip: if you switch suppliers every year, this will allow you to enjoy the ‘welcome’ rebate every year too.

Don’t forget to request a ‘smart meter’ (slimme meter) to be installed in your house

You can opt for fixed rates and variable rates. It might seem attractive to opt for variable rates (they change every January 1 and July 1) if you are confident prices will go down. Nonetheless, according to the consumer site PriceWise (www.pricewise.nl) it is wiser to go with fixed anyway, as often the prices are actually cheaper, while – if the price is continuously rising – you are locked into this contract for its duration, with the accompanying obligation to go with the rising prices.

If you want to make sure that you contribute to sustainability, the Dutch consumers’ association (Consumentenbond) has looked into the various companies offering ‘green’ energy. They evaluate the companies based on the sustainability of the produced or purchased utilities, how the utilities are delivered to the consumers, and their investment policies. The use of fossil fuels, gas and nuclear energy is ‘penalized’, while the use of wind energy, solar energy, and (certain types of) biomass is rewarded, as is the (direct or indirect) investment in sustainable production capacities. The most recent overview can be found on www.consumentenbond.nl/energie-vergelijken/

Useful links
www.gaslicht.com
www.independer.nl
www.energievergelijken.nl/en
www.pricewise.nl
www.consumentenbond.nl
www.ampeer.nl

Estate Planning: Is That What We’re Working For Now?

By Yolanda Bokhorst

Don’t we all want the best for our children? We provide them with a safe and sheltered home, we raise them well, make sure they get an education and try to give them the tools to find their way through an increasingly complex world.

What role does money play in all of this? The question that arises is of course how we can best transfer our assets to our children – the following generation(s).

Dutch Taxes

Many people think that this largely involves trying to reduce taxes. Of course, taxes play a role, but opinions differ as to whether minimizing taxes should be the determining factor.

Be it as it may, when you live in the Netherlands, you deal with two types of taxes when you transfer property: gift tax and inheritance tax. Gift tax is owed by the recipient over any gifts made by a donor during their lifetime. Inheritance tax is due by the beneficiary over what they inherit upon the death of a person. The rates of these two taxes are the same. Both gift tax and inheritance tax have exemptions – these are not the same; you can find the rates and exemptions on www.belastingdienst.nl.

When determining whether taxes are due, the Netherlands applies the principle of domicile: if the donor or deceased lived in the Netherlands, Dutch inheritance and gift tax apply. If a home that is located in the Netherlands is gifted, transfer tax also applies, but when a home is inherited, it does not. When shares in a privately-owned company are gifted or inherited, then in some cases income tax is due. In short, when it comes to estate planning, there can be a maze of tax consequences.

Foreign Taxes

From an international perspective, taxes have not been harmonized, and personally I believe this will be hard to accomplish. The plain fact is that each country has its own tax rules. These various rules can apply when a non-Dutch person, who is living in the Netherlands, gifts something to their children or passes away here. This could give rise to double taxation, should the country of nationality levy taxes based on nationality while the Netherlands levies taxes based on domicile. In this case, it is up to tax treaties or unilateral regulations to make sure that double taxation is avoided – or at least limited as much as possible.

Estate Planning

The aim of estate planning is to limit the tax effects of the transfer of your assets to the next generation. The basic principle in the Netherlands is that the entire family profits most if the assets are split 50-50 among the parents first, after which they are passed on to the children in two equal parts. This allows everyone to make optimal use of the gift and inheritance tax exemptions and rates.

The next point to consider is whether the assets should be transferred before or after the death of the parents. Sometimes, it is a good idea to gift them and to accept the consequences of gift tax (at a lower rate), knowing that more taxes might be due if it is all inherited in one go.

Three Pillars

In short, there are three different areas in which matters must be arranged – all of which must be coordinated with each other:

– Matrimonial Property Law: a prenup can help you ensure that your assets are split 50-50 over both parents. When the first parent passes away, the first half goes to the children, when the second parent passes away, the second half does.

– A gifting plan: when and what do you gift your (grand)children? And how much should you hold on to for now, for yourself?

– The will: how do you ensure that, after your death, the assets go to the right persons?

The aim of estate planning is to limit the tax effects of the transfer of your assets to the next generation

No Trust

In Common Law countries, many people make use of a trust to arrange matters. This is not only often fiscally advantageous, but it is also an excellent way to manage the assets. This helps avoid that children, at a young age, have a say in what happens to the family assets. In the Netherlands, no one makes use of trusts. It is not fiscally attractive and therefore quickly becomes unappealing. Trusts set up abroad might be recognized in the Netherlands, but then they have to meet certain criteria. Which means that their fiscal consequences in the Netherlands remain unclear.

Limiting the Children’s Say

In the Netherlands, administrators are appointed in order to avoid that children (who are too young) have control over what they are gifted or what they inherit. A parent who gifts something can remain administrator until the child reaches a certain age. This way, the child cannot access the assets themself. Of course, the assets can be used for ‘wise’ things, but the person who decides whether this is the case is the administrator, and not the child.

In a will, you can also appoint an administrator , who will manage the assets your children inherit upon your death. Depending on the type of assets, there are other ways of limiting the say your children have over them. But this is something I can go into in more detail some other time.

Finally

Estate planning has to be tailor-made. It should take into account not only fiscal aspects, but also the way you want your assets managed within the family. A civil law notary, who is specialized in international inheritance law, can tell you more about this.