Pensions and Saving for Retirement in the Netherlands

Three pillars

1. State pension (AOW)

2% of the full amount for every year you lived or worked here in the 50 years before AOW age.

2. Workplace pension

Built up through your employer; premiums are taken from gross salary, tax-free.

3. Private saving

Annuity (lijfrente) products or a bank savings account, with a tax deduction if you have a pension gap.

The new pension system

Under the Wet toekomst pensioenen, workplace pensions move to a system with personal pension pots. All funds must switch by 1 January 2028 at the latest. Your fund writes to you about the switch.

Tax-deductible saving: the annual margin

If your workplace pension is small, or you are self-employed, you can deduct payments into an annuity (lijfrente) product up to your annual margin (jaarruimte): roughly 30% of your income above a threshold, minus the pension you already build up. Unused margin from earlier years (reserveringsruimte) can be used too. The Belastingdienst has a calculator for your exact margin.

For expats

• Years before you moved here are an AOW gap. A pension from another EU country or a treaty country may cover those years.
• Foreign pension plans (a 401(k), a UK workplace pension, Indian EPF) are treated differently depending on their conditions. Have them checked before deciding whether they belong in Box 3.
• If you leave the Netherlands, your AOW and workplace pension are paid abroad too; the treaty decides where they are taxed.