Holiday allowance in the Netherlands

Holiday allowance

If you start working in the Netherlands you will notice that your contract mentions a holiday allowance. But what is that, a holiday allowance, referred to as ‘Vakantiegeld’ in Dutch?

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Holiday allowance

Holiday allowance is an allowance that employees in the Netherlands receive from their employer to cover extra costs for holidays. Outside the Netherlands, holiday allowance is an unknown concept. Of course, it is not mandatory to spend the allowance on a holiday, but that was originally the intention, since the Dutch government wants employees to be able to go on holiday. 

How high is the allowance?

The holiday allowance is at least 8 percent of the gross salary you earned during the past year (for example, from May to May) and is paid on top of it. In principle the allowance is paid in a lump sum in May or June. The holiday allowance may only be paid monthly together with your regular salary if this is explicitly stated in your employment contract. The allowance may not be hidden in your regular salary. It is stipulated by law that the holiday allowance must be shown on your pay slip separately.

The allowance is also calculated on extra hours worked (overtime). On the other hand, holiday allowance is not calculated over expenses, bonuses, or profit distribution. Besides receiving the holiday allowance you will continue to be paid during your holiday. And if you are ill, the accrual of your holiday allowance continues.

You have not worked a full year

If your contract starts during the year then the holiday allowance is calculated pro rata. If your job ends, the accumulated amount is paid out immediately with the last salary payment.


When the holiday allowance is paid, taxes are immediately withheld by the employer and the right tax credits are calculated. And for those who benefit from the 30% ruling, this also applies to the holiday allowance.

Nice benefit

Holiday allowance is a nice benefit for the employee. Employers have to make sure that the correct amount is paid. Expatax can assist employers and take care of the payroll administration. Enjoy your holiday!

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