If you work and have a young child in the Netherlands, the income-dependent combination tax credit can reduce your Dutch income tax. Its Dutch name is inkomensafhankelijke combinatiekorting, usually shortened to IACK. For 2026, the maximum is €3,032 for someone who has not yet reached Dutch state pension age.
This is separate from childcare allowance and the child budget. You claim it through your income tax return, and eligibility depends on your own earned income and family circumstances. It is easy to miss if you assume every form of support for parents comes through the benefits system.
Start with the four eligibility questions
For a parent in the usual Dutch resident situation, the main checks for 2026 are:
- Is your earned income more than €6,239?
- Do you have a child who is under 12 on 1 January 2026?
- Does that child belong to your household for at least six months of the year, or do you qualify under the co-parenting rule?
- Are you without a fiscal partner, with the same fiscal partner for less than six months, or earning less from work than the fiscal partner you have for at least six months?
These conditions work together. Having a child does not by itself qualify you. Neither does working part time, being unmarried or paying for childcare. You need to establish the household and partner position as well as the income.
The age test is tied to the start of the year. A child who turns 12 in August 2026 can still meet that test for 2026. A child who was already 12 on 1 January cannot. If you also have a younger child, check your position using that child instead.
The credit is not multiplied by the number of children. Two eligible young children do not give one parent two combination credits. That matters when estimating what a second child will change in the family budget.
Earned income is not your bank balance or take-home pay
The Dutch term arbeidsinkomen refers to income from work, including employment and self-employment. Use the annual income figures relevant to the return, rather than adding up the net salary payments that reached your bank account.
For a business owner, sales are not the same as earned income. Business costs need to be considered. Nor should you assume that an income figure used for a benefit application is automatically the correct figure for this credit. Different calculations can use different definitions of income.
Consider a couple where one parent receives more money overall because of investment income, while the other earns more from employment. The combination credit compares the relevant earned income. Looking only at total cash coming into each bank account can point you towards the wrong parent.
Gather both partners’ annual employment statements and any business income information before checking the credit. Comparing the correct annual figures makes it easier to identify which partner has the lower earned income.
How the 2026 calculation works
For someone who does not reach AOW age during 2026, the credit builds at 11.45% of earned income above €6,239, up to a maximum of €3,032. There is no credit at earned income of €6,239 or less.
Imagine Alex, a single parent with a seven-year-old child who lives with Alex all year. Alex has €24,000 of earned income in 2026 and meets the other conditions. Subtracting €6,239 leaves €17,761. Multiplying that by 11.45% gives a calculated credit of about €2,034, rounded to whole euros.
That is a tax credit, not a separate grant that is always paid in full. Tax credits reduce the income tax and national insurance contributions you owe. The amount you can actually use also depends on the tax calculation and your other credits. An unused part of the IACK cannot be paid out against your partner’s tax liability.
You might receive a refund after filing if too much tax was already withheld. Alternatively, the credit may reduce an amount you would otherwise have to pay. The calculated credit and the eventual payment into your account are therefore different figures.
Different calculations apply if you have reached AOW age or reach it during 2026. Use the calculation in the Dutch return or provisional assessment for that situation. The formula here is for someone below AOW age throughout the year.
Which partner gets the credit?
Suppose Priya and Daniel are fiscal partners throughout 2026 and their five-year-old lives with them all year. Priya earns €29,000 from work and Daniel earns €53,000. Subject to the other conditions, Priya is the parent who qualifies because she has the lower earned income.
They cannot choose Daniel simply because he pays more tax. This is not a deduction the couple can allocate freely between their returns. If their earned incomes are exactly equal, the older fiscal partner gets the credit, provided the remaining conditions are met.
Fiscal partnership is a Dutch tax concept. It is not determined only by whether you are married or which parent usually does the school run. Having a child together can affect the position. The guide to living together and Dutch tax and benefits explains why different systems may also use different partner rules.
Dates matter when you form a new household during the year. A partner from November does not necessarily produce the same outcome as a partner for the whole year. Complete the questions using the actual timeline instead of describing only your circumstances on 31 December.
Shared care after separation
A child can be registered at one address while spending substantial time in both parents’ homes. The combination credit has a co-parenting rule to deal with that situation. Registration with the other parent does not automatically rule you out.
Under the current rule, the child must belong to each parent’s household for at least 156 days in the calendar year. That is an average of three days a week, although the weekly pattern need not always be identical. Keep a record of the arrangements and the actual care pattern.
Both parents must separately meet the remaining requirements. A new fiscal partner can affect that assessment. Occasional weekend visits do not automatically satisfy the shared-care condition, while genuinely shared care should not be dismissed just because only one parent has the registered address.
After a separation, check this alongside the other changes to the return. The guide to Dutch tax partnership when separating helps identify the dates and household details you will need.
A new baby or a new job can change the answer
A child born late in the year will normally not yet satisfy the six-month household condition for that year. For example, a baby born in November 2026 does not ordinarily create entitlement for 2026. Being under 12 is only one part of the test.
Changing working hours can affect both the amount and which partner qualifies. If one parent’s income falls below the other’s, the eligible parent may change. If earned income falls to the threshold or below it, no IACK is calculated for that person.
When considering an extra working day, include the rest of the household budget too. Additional pay, travel costs and childcare costs all matter. The credit is one element of that calculation. The article on Dutch childcare allowance and your own costs can help you estimate the childcare side separately.
Claim through your Dutch tax return
You claim IACK through the income tax return for the relevant year. The return for 2026 is filed after that year has ended. Answer the questions about children, household periods, partners and income, then check the tax credits section of the calculation.
If you want the credit taken into account during the year, you can apply for a provisional assessment. This uses estimates. Update it when your annual income or family circumstances change so that the provisional refund does not run ahead of your final entitlement.
I help with Dutch income tax returns, including checking credits against the information about your household and income. For a shared-care situation, bring the care arrangements as well as the annual income statements. The relevant dates are just as useful as the amounts.
Living abroad or moving countries during the year adds another question: which parts of the Dutch tax credits are available to you? Do not assume the resident example above settles that. Your residence and insurance position need to be checked separately.
Keep the family schemes separate
The child budget and childcare allowance have their own conditions and application routes. Receiving one does not prove you qualify for IACK, and being ineligible for IACK does not settle your entitlement to the others.
Older lists may also mention a single-parent tax credit or parental-leave tax credit. Those Dutch credits were abolished in 2015. They should not be included in a calculation for 2026. The additional support for single parents within the child budget is a different provision.
When your work or family arrangements change, review each scheme separately. A change reported for one may not update the others.