What are tax credits?
A tax credit is an amount you can deduct directly from the tax you owe. If you owe €2,000 in tax and are entitled to €1,800 in tax credits, you pay net only €200.
Important: tax credits cannot reduce your tax amount below zero. You cannot receive them if your tax owed is lower than the credits — unless you have a tax partner, in which case the credits are sometimes partially settled with the partner.
Tax credit vs. deduction: A deduction of €1,000 at a 37% rate gives a benefit of €370. A tax credit of €370 always gives €370, regardless of your tax rate — and is therefore often more advantageous.
General tax credit 2026
The general tax credit (algemene heffingskorting) is the basic credit almost everyone is entitled to. The amount is income-dependent and phases out at higher incomes:
| Income (box 1) | Credit |
|---|---|
| Up to €24,813 | €3,362 (maximum) |
| €24,813 – €75,518 | Phasing out |
| Above €75,518 | €0 |
* Indicative amounts for 2026.
Labour tax credit 2026
The labour tax credit (arbeidskorting) is intended for working people. Retirees with only AOW and pension are not entitled to it. Are you still working (part-time)? Then the labour tax credit can amount to €5,599 (maximum, at an income around €40,000).
Elderly tax credit 2026
AOW recipients are entitled to the elderly tax credit of €2,035 (at income up to €44,770). This is the most valuable credit for retirees.
Are you single? Then the single person elderly tax credit of €478 also applies.
→ Read more about the elderly tax credit
Young disabled tax credit (Wajong)
Do you receive a Wajong benefit? Then you are entitled to the young disabled tax credit (jonggehandicaptenkorting) of €890 (2026).
Life-course savings credit
Did you save before 2022 via a life-course savings scheme and are now having this paid out? Then you may be entitled to the life-course savings credit. Ask your employer or financial adviser about this.
Overview of tax credits 2026
| Tax credit | For whom | Maximum amount |
|---|---|---|
| General tax credit | Everyone | €3,362 |
| Labour tax credit | Working people | €5,599 |
| Elderly tax credit | AOW recipients | €2,035 |
| Single person elderly tax credit | Single AOW recipients | €478 |
| Young disabled tax credit | Wajong recipients | €890 |
| Income-dependent combination credit | Working single parents | €2,950 |
* Indicative amounts for 2026.
Common mistake: not using credits
The most common mistake is that retirees don't file a tax return and therefore don't fully receive the elderly tax credit or the general tax credit. If your tax is lower than the credits, you cannot get the difference back directly — but via a tax return you ensure everything is correctly settled.
We check on every tax return whether all credits are fully applied.
Do you know a retiree who might be missing their credits? Forward this article.
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