Ownership of a second home is considered as an asset. A notional yield is calculated on the asset value of the property (based on the so-called 'leegwaarderatio', or 'vacancy rate', which is 6.17% in 2023). Tax is then levied on this notional yield (at a rate of 32% in 2023).
To calculate the tax payable, you can follow these steps:
Step 1
Find the WOZ (real estate valuation) value on the notice issued by the municipality. The WOZ value can usually also be found online via the WOZ valuation portal.
Step 2
Calculate the annual rental value by multiplying the monthly rental value at the beginning of the calendar year by 12.
For example, if the monthly rental value at the beginning of the year is €600, then the annual rental value is (12 x €600) = €7,200.
Step 3
Calculate the percentage that reflects the ratio of the annual rental value to the WOZ value by dividing the annual rental value by the WOZ value and then multiplying by 100.
For example, if the WOZ value is €250,000 and the annual rental value is €7,200, then the percentage is (€7,200 / €250,000) x 100 = 2.88%.
Step 4
Find the result from step 3 in the table for the relevant year.
For example, if the percentage falls between 2% and 3%, the vacancy rate is 84% (in 2023).
Step 5
Calculate the value of the rented property by multiplying the WOZ value by the vacancy rate.
For example, if the vacancy rate is 84% and the WOZ value is €250,000, then the value of the rented property is €210,000.
Step 6
A notional yield is then calculated on the value of the rented property (6.17% in 2023). Tax is then levied on this notional yield (at a rate of 32% in 2023).
For a property with a WOZ value of €250,000 and annual rental income of €7,200, the asset value for tax purposes is determined by the Tax Authority to be €210,000. The notional yield is €12,957 (€210,000 x 6.17%). The tax payable is €4,146 (€12,957 x 32%). The rental income received is not subject to tax.
