---
title: "What is the payroll tax credit?"
term: "Payroll tax credit"
description: "Payroll tax credit is the tax credit your employer or benefit provider can apply through payroll so less tax is withheld each month."
date: 2026-08-02T00:00:00.000Z
lastVerified: 2026-08-02T00:00:00.000Z
source: https://dutchtaxcalculator.nl/glossary/payroll-tax-credit
---

# What is the payroll tax credit?

> Payroll tax credit is the tax credit your employer or benefit provider can apply through payroll so less tax is withheld each month.

Dutch term: _loonheffingskorting_

If nobody applies the credit, or two employers both apply it incorrectly, your payslip and year-end result can diverge. Our calculator can model whether the credit is applied under the assumptions you choose.

After the first definition, we normally say "payroll tax credit" rather than only the Dutch term.

## FAQ

### What is Payroll tax credit in simple terms?

Payroll tax credit is the tax credit your employer or benefit provider can apply through payroll so less tax is withheld each month.

### Is this personal tax advice?

No. These pages are educational estimates. Use your payslip, assessment, employer, Belastingdienst guidance, or a qualified adviser for personal decisions.


## Sources

- [Belastingdienst: income-tax rates and credits](https://www.belastingdienst.nl/wps/wcm/connect/nl/werk-en-inkomen/content/hoeveel-inkomstenbelasting-betalen)

---
Source: https://dutchtaxcalculator.nl/glossary/payroll-tax-credit