Holiday Allowance and Paid Holidays in the Netherlands

What is holiday allowance? Apart from a number of paid holidays, employees in the Netherlands are also entitled to a holiday allowance. In Europe, the holiday allowance is not a common mandatory benefit. In this blog, we will explain the most important aspects of the Dutch holiday allowance and paid holidays in the Netherlands. 

What is the Dutch holiday allowance?

Holiday allowance - "Vakantiegeld" in Dutch - is a mandatory payment by employers in the Netherlands. Employees in the Netherlands, both full-time and part-time, are entitled to the holiday allowance. As of January 2020, the standard rate is a minimum of 8% of your gross salary. Only if your employee earns over three times the legal minimum wage, you do not have to pay holiday allowance. This, however, has to be stated in the contract.

When do you pay holiday allowance?
Employers can decide when to pay the holiday allowance to the employee. It is common to do it in one of the following ways:

  • In 1 installment: The employer pays the holiday allowance in one installment (8% x annual salary). This is usually done in May or June. In this case the employee will receive their monthly salary of the specific month and the holiday allowance (monthly salary * 96%). 
  • In 12 installments: The employer pays the 8% on a monthly basis on top of the salary. 

Calculations examples


Monthly salary

$ 5.000,-

Monthly holiday allowance (8%)

$ 400,-



Annual salary

$ 60.000,-

Annual holiday allowance (8%)

$ 4.800,-



Paycheck example if holiday allowance is paid on a monthly basis (12 installments)

[$ 5.000,- + $ 400,]- = $ 5.400,- monthly paycheck

Paycheck example if employee receives the holiday allowance in one installment in June:

[$ 5.000,- + $ 4.800,]- = $ 9.800,- paycheck in June

Do employees pay taxes on the holiday allowance?
Yes, the amount depends on a couple of factors such as total gross salary. 

Paid holidays in the Netherlands

Full-time employees are entitled by Dutch law to a minimum of 20 days (four weeks) of paid in leave per year. This is based on a calculation: four times the number of hours worked per week.

Part-time employees are also entitle to four times the number of hours worked per week. A part-time employee who works 24 hours (3 days) it legally entitled to have 12 days of paid leave per year. 

Hours worked per week Annual paid holiday leave in the Netherlands
40 hours 20 days (160 hours)
36 hours 18 days (144 hours)
32 hours 16 days (128 hours)
28 hours 14 days (112 hours) 
25 hours 12.5 days (100 hours)
24 hours 12 days (96 hours)

Many Dutch companies offer more than the minimum number of paid holidays. For many employers it is common to give employees between 25 and 30 days of paid vacation leave. Some employers also offer the possibility to "buy" extra days off via salary sacrifice. Holiday leave is also accumulated during maternity leave and (temporary) sick leave.

Please note that holiday leave is separate from Dutch national (bank)holidays, which are also paid if they fall on a weekday. 

Interested in comparing the paid holidays in the Netherlands to paid holidays in other European countries? We wrote a blog on Paid Vacation Days in Europe 2021 which gives a nice overview.

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Sources: CNBC

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