Dreaming of a holiday home at home or abroad? Then make sure you have a good understanding of what ‘a second home’ means and how to determine its value. And what happens if you rent out your second home?

Holiday home inside or outside the Netherlands

• A second home is a house you own but do not live in, e.g. a holiday home inside or outside the Netherlands. The following types of house do not fall under the denominator ‘second home’:
• Your (temporary) own home that is your main residence in the year of declaration. Indicate this under ‘Own home’ in box 1.
• A house you rent out, including your former own home that you temporarily rent out while waiting to be sold. Indicate this under ‘Other real estate’ in box 3.
• An estate, forest or nature reserve that is wholly owned by you. Enter this under ‘Other property’ in box 3.

A second home in the Netherlands

Do you have a second home in the Netherlands? If so, this falls under your assets in box 3 of your tax return. Every year, you have to report the value of the house on 1 January of the year before the year of declaration. You can find the so-called ‘WOZ value’ (Valuation of Immovable Property) on the WOZ assessment you receive from the municipality. For a leasehold house, you deduct the value of the future leasehold canons (i.e. 17 times the annual leasehold canon) from the WOZ value.

If you (temporarily) rent out your second home in the Netherlands (e.g. to students), you do not have to report the rental income in your tax return. The value of the home in box 3 is sufficient (see above).

Second home outside the Netherlands

Is your second home outside the Netherlands? Then you must report the value of the home in unoccupied condition on 1 January of the year before the year of declaration.

Tax on income from second home

If there is more than just temporary rental (e.g. when you offer breakfast/dinner or provide linen, your rental income from your second home may be taxed. This depends on the amount of labour you perform and whether you have a higher rental income as a result. If necessary, declare your rental income as ‘Income from other work’ in Box 1. There may also be profit from business.

It is also possible that you carry out activities that are not related to renting out your second home. Think of tours in a museum, transport to and from the airport, etc. In that case, there is additional income. Report them as ‘Result from other work’ in box 1 or as profit from business.