Keeping money in the Bank:

  1. Bank interest in NL is around 1% if you maintain your money in the “savings account”
  2. NL Banks offer you different products that can get you higher interest upto about 5%. If you want to keep your money in Euros, better option is to keep the money in an FCNR bank account in India – the interest rate is guaranteed.
  3. If your savings is more than € 20,000 you need to pay “Savings tax” @1.2% of the entire savings (goes into Box 3 in the tax filing form). However, if you have 30% ruling, this tax is not applicable making it effectively 0%.
  4. If you don’t mind the risk of Rupee devaluation, keeping the money in a FD in a NRE account in India makes more sense. The interest from NRE account is tax free. Different banks give different interest rates. So check on the internet which bank gives the highest rate. The money is also fully repatriable (i.e you can convert them back to Euro) at the current rate.

Stock Market:

  1. It is allowed to open a trading account and invest in the stock market. Whatever money you have invested+gained in the stock market is subject to “Savings” tax applicable @1.2% (to be filled into Box 3 in the tax filing form). However, if you have 30% ruling, this tax is not applicable making it effectively 0%.
  2. There is no short term and long term gains concept. All gains fall under point 1 above.
  3. You can open a trading account with many banks….however practically I think ABN AMRO is the only place you can open it because the others ask that you know Dutch language to even speak to you beyond  a few sentences!!
  4. Each transaction costs €10 to €150 depending on the volume of shares traded. On top of it, banks may charge maintenance fee.
  5. It is allowed to trade in other country stock exchanges via a Dutch trading account. For example, you can trade US stocks listed in NASDAQ, UK stocks etc with your Netherlands trading account. Again, bank may charge extra for this service.
  6. ESOP is taxed like in India when it is exercised – (FMV on exercise date – grant price)*% time spent in NL during the vesting period. Check this link for an example: http://www.globalequity.org/membersonly/GlobalUpdates/NetherlandsPlcyStatmnt32202.pdf

Out of the box:

  1. Some people take personal loan at about 5% interest from a NL bank, convert it to Rupee FD @9% in India! They payback the loan in Euros as they earn in Euros 🙂

Starting a company:

  1. You are allowed to start your own company in NL. For details, go to http://www.kvk.nl. The website also has English pages. For any questions, you can call them and they will be more than happy to clarify your questions.

Disclaimer: This is my personal opinion only. No responsibility will be taken for inaccuracies. Base your decisions at your own risk.

10 thoughts on “Investments

  1. Gajanan

    Can you please provide me some information about the Out of the box section.
    I inquired about the personal loan in ABN Amro and I was told that the interest rate is 13 – 14%. Can you please tell me where did you inquire about this loan? Can you please provide me some more information about it.
    Thank you in advance.


  2. Deepa

    Hi Madhu,

    Nice Initiative. I have a question on the below,

    “If your savings is more than € 20,000 you need to pay ”Savings tax” @1.2% of the entire savings (goes into Box 3 in the tax filing form). However, if you have 30% ruling, this tax is not applicable making it effectively 0%”

    How does the 30% can exempt from ”Savings tax” @1.2% ? Did you read in the rule book, if its so could you please mention the rule number or please share the link ? Thanks.

    1. admin Post author

      Hi Deepa, like I have mentioned this website is from my experiences. The input for this exemption is from one of the experts I contacted and also from the many websites that talk about it. For rule book I suppose you will need to go to a tax-expert.

  3. Kalpik Nigam


    Thanks for this wonderful blog! Would you also know if there are any tax implications if I transfer money from my India bank account to my NL bank account?


  4. Saloni

    Since NRE account interest is tax free in India. Does it mean that we have to pay tax over that in Netherlands.
    I tried to the double taxation treaty but couldnt find a clear answer.
    Anything you have heard or know from experience?

  5. Abhishek Sharma

    Hi Madhu,

    Thanks for this useful post! Since it has been quite a while since the original post and the rules might have changed, I have a few questions, which if you can help me with, will be very useful.

    1. If I am working in the Netherlands and each month invest in a SIP in India with a NRE account, do I need to declare my investments in Dutch tax returns each year? If so, how exactly do you do that? I tried to get this answer from a tax consultant but wasn’t quite clear.
    2. At any point in time if I decide to repatriate all earnings from investments in India to my ABN AMRO account, would I have to declare it in tax returns? Will it get taxed again in the Netherlands considering it was already taxed in India?
    3. I have heard that in tax returns, we only need to declare our total income as of 1st Jan of that year including the amount invested worldwide. Can you help answer how this is done exactly?
    If the returns on investment and the invested amount itself in Indian SIP does not matter to Dutch government, I would assume its better to have most of your income invested in India than to have no returns in a dutch bank account.

    1. Madhu Post author

      If you have 30% ruling, you are exempt from declaring any assets at all. If not, the tax form has a placeholder where you declare the value of all your liquid assets across the world and you pay 1.2% of that value as tax.


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