Renting out your home temporarily or permanently: what are the legal and tax implications?

You may need a permit (from the municipality, for example) to rent out your home. Your municipality may also impose a maximum number of days per year that you’re allowed to rent out your home. Check the rules in your municipality to avoid facing a fine. 

If your apartment is part of a Homeowners Association (VvE in Dutch), the association’s notarial deeds might include rules on renting. Remember to check the association’s own rules and regulations too, as they might include agreements that you should be aware of.

If you have a mortgage, ask for permission from the mortgage provider before you rent out your home. Banks are often cautious about this, so check the terms and conditions of your mortgage or discuss your options with the mortgage provider.

Renting out your home forms a greater risk for insurance companies than living in it yourself. Home insurance policies from some companies don’t cover you if the property is rented out, so it’s a good idea to discuss your rental plans with the insurance company well in advance.

There are two important questions: do you have to pay tax on the actual rental income and are the costs tax deductible? And do you lose out on mortgage interest relief by renting out?

If you rent out all or part of your home temporarily, you must declare 70% of your rental income and the relevant costs in your income tax return as ‘Income from temporary rental’. The ‘eigenwoningforfait’ (additional tax on taxable income from your main residence) and the tax deductible costs (including on interest) remain the same.

If you rent out part of your home for an extended period, and this is not an independent dwelling, you can use the ‘tax emption for a room’ rule if:

• the annual proceeds in 2024 are no more than €5,998;
• both you and the tenant are registered as living at the address in the Personal Records Database (BRP).

If you don’t meet both conditions, the rented part of your home will come under Box 3. The part that is not rented out remains in Box 1, with the additional tax liability for the ‘eigenwoningforfait’ and the mortgage interest deduction. More information is available on the site of the Dutch Tax and Customs Administration. An extension of the ‘tax exemption for a room’ rule was considered in early 2025.

You don’t usually have to pay VAT when renting out accommodation temporarily, although you may be liable to pay it in certain cases. If your annual revenue is no higher than €20,000, you can use the small business scheme (kleineondernemersregeling, KOR). A tax adviser will be able to provide more advice.

Read up on all the legal, tax and financial aspects before you start renting out accommodation, including through Airbnb. The Dutch government’s website provides more information about this. A tax and legal adviser can give you more specific information.