What is Vakantiegeld?
Vakantiegeld is the Dutch statutory holiday allowance, set at a minimum of 8% of gross annual salary and paid on top of regular wages. It is a legal entitlement under the Wet minimumloon en minimumvakantiebijslag, not a discretionary bonus, and applies to every employee on a Dutch employment contract regardless of seniority, role, or nationality.
For foreign employers hiring through Octagon's EOR services, vakantiegeld is a mandatory line item in the total employment cost calculation and must be budgeted separately from base salary at the offer stage.
How does Vakantiegeld work?
Accrual runs from 1 June of one year to 31 May of the next. Each month, the employer sets aside 8% of the gross salary earned during that period and either pays it out in a single lump sum in May or June, or distributes it monthly across each payslip where the contract explicitly allows. The lump sum is taxed at the bijzonder tarief, a special rate that matches the employee's highest marginal bracket and produces a higher withholding than on regular monthly wages.
Vakantiegeld is visible as a separate line on the payslip and in the annual jaaropgaaf. For a full calculation example, see the vakantiegeld calculation guide.
Who does Vakantiegeld apply to?
Vakantiegeld applies to every employee on a Dutch employment contract, including permanent, temporary, fixed-term, part-time, and EOR-employed staff. It applies equally to directors on a Dutch payroll, to expats benefiting from the 30% ruling (calculated on the taxable portion), and to agency workers placed through a payroller. Collective agreements in sectors such as construction, healthcare, and public administration frequently raise the percentage above 8%, so the sector CAO should always be checked before setting the rate.
When does Vakantiegeld not apply?
Vakantiegeld does not apply to genuine self-employed contractors, to workers engaged under a service contract (overeenkomst van opdracht) outside an employment relationship, or to foreign employees physically working outside the Netherlands where Dutch employment law does not govern the contract. It also does not accrue on statutory transition payments, on severance beyond the contractual wage, or on purely in-kind benefits that fall outside taxable wage. For expats, the 30% ruling reduces the taxable base but does not remove the vakantiegeld obligation, as explained in 30% ruling guidance for 2025.