The mortgage interest deduction lets you subtract the interest on the loan for your own home from your taxable income in Box 1. In 2026 you deduct at a maximum rate of 37.56%, for up to 30 years per loan. A loan taken out from 2013 must be repaid in full within 30 years, at least on an annuity or linear schedule. Older loans may fall under transitional rules.

That last condition matters if you take out a new or higher loan or refinance. A new loan, a higher loan or a different repayment form can change what you get back. Below you’ll find the rules, the figures and a worked example, so you can run the numbers yourself.

Table of Contents

The basics of the deduction

Every year you pay interest to your lender. The Dutch tax system treats that interest on your own home as a deductible cost. You subtract it from your income in Box 1, the box that also holds your salary. Your taxable income drops, so the income tax you owe drops as well.

The deduction generally covers qualifying debt for your main residence, with limited temporary exceptions such as a former home that is empty and for sale. A holiday home or a rental property falls under Box 3. You cannot deduct the interest on those loans, even if the same lender provides them.

You don’t get all your interest back. You get back a percentage of it, linked to the tax rate that applies to the deduction. The eigenwoningforfait that is added to your income then trims that benefit a little further.

Think of it as a discount on your interest bill. Your bank charges you the gross interest, and what the home costs you after tax is the net interest. When you compare refinancing offers, the net figure is the one that ends up in your budget. Lenders use their own affordability calculation, which differs from your net figure.

Who qualifies for the mortgage interest deduction

You qualify if you own the home you live in and you borrowed money for it. The purpose of the loan decides whether the interest counts: the loan must be used to buy, improve or maintain that home. Borrowed money spent on a car, a holiday or savings does not count, even if it sits within the same mortgage.

The Belastingdienst calls the qualifying part of your loan the eigenwoningschuld. Only interest on that part is deductible. If a portion of your mortgage goes to other purposes, you split the interest. One part reduces your tax and the other part does not.

For loans taken out from 1 January 2013, there is a strict repayment condition. You repay the loan in full within 30 years, at least on an annuity or linear schedule. Loans from before 2013 that you never increased may still follow the older rules. That part can stay interest-only and keep its deduction.

A few situations have their own rules. If you leave the Netherlands and your home stands empty and for sale, you keep the deduction for that year and the three years after. If you rent the home out instead, you cannot deduct the interest for the rental period.

Why annuity or linear repayment is required

The repayment condition links the deduction to a loan that shrinks over time, so homeowners actually pay off their debt. Under the older rules, interest-only loans could keep their full balance and still carry the deduction. Since 2013, new loans only qualify when they are repaid.

Both repayment forms meet the condition. With an annuity mortgage you pay a level gross amount each month. In the early years most of it is interest, so your deduction is relatively high. With a linear mortgage you repay a fixed amount each month, so your payments fall gradually. Your interest falls faster, and so does your deduction.

For a refinancer this matters in two ways. If your loan dates from before 2013 and you never increased it, you may keep the interest-only portion under transitional rules. If you raise the loan when refinancing, the extra amount counts as a new loan. That new part must be repaid on an annuity or linear basis to qualify.

So check the start date and history of each loan part before you sign a new offer. Your lender’s annual statement shows the parts and their repayment form. If you are unsure which rules apply, the Belastingdienst can confirm how your loan history is treated.

The 2026 rate and what it means for higher incomes

In 2026 you deduct your mortgage interest at a maximum rate of 37.56%. In 2025 that rate was 37.48%. Since 2023 nobody deducts at a higher rate than this maximum, whatever their income.

The cap matters most if you earn more. In 2026, income above €78,426 is taxed at 49.50%. Your mortgage interest still lowers your tax at 37.56% only. On a higher income, the deduction is therefore worth less than your top tax rate suggests.

Figure	2026	Note
Maximum deduction rate	37.56%	37.48% in 2025
Income where the cap matters	above €78,426	taxed at 49.50%
Eigenwoningforfait, most homes	0.35% of WOZ value	added to Box 1 income
Maximum deduction period	30 years per loan	fresh term for an increase
Repayment condition, loans from 2013	annuity or linear	repaid within 30 years
Eligible home	your own main residence	not a rental or holiday home

Your bracket can change. A raise, a new job or a change in hours can move your income across the threshold. Below it, the deduction rate and your own rate sit close together. Above it, the gap widens, and your net monthly cost rises compared with what a simple calculation would show.

Notional rental value and your net benefit

The tax office adds a fixed amount to your income for owning your home. This is the eigenwoningforfait, or notional rental value. It is a percentage of your home’s WOZ value, the value your municipality sets each year. For most homes the forfait is 0.35% in 2026.

The calculation is straightforward. Your deductible amount is the interest you paid minus the eigenwoningforfait, and what remains lowers your Box 1 income. Because the forfait depends on the WOZ value, a higher valuation slightly reduces your net benefit. That is one reason to check your WOZ assessment each year.

Take a homeowner with a €300,000 mortgage, €12,000 interest in 2026 and a WOZ value of €400,000, taxed at the 37.56% rate. The eigenwoningforfait is 0.35% of €400,000, so €1,400. That leaves a deductible amount of €12,000 minus €1,400, which is €10,600. At 37.56%, this saves roughly €3,981 in tax. It is an illustration, not a quote.

Step	Calculation	Result
Mortgage interest paid	interest in 2026	€12,000
Eigenwoningforfait	€400,000 × 0.35%	€1,400
Deductible amount	€12,000 minus €1,400	€10,600
Tax saved	€10,600 × 37.56%	approx. €3,981
Net interest cost	€12,000 minus €3,981	approx. €8,019

The bank receives €12,000 in interest, while after tax the interest costs this homeowner roughly €8,019. Lenders assess affordability on their own terms, so the net figure you calculate will not match theirs one to one. Use it for your own budget rather than for the lender’s assessment.

How long you can deduct mortgage interest

Your deduction lasts a maximum of 30 years per loan. The term starts when you take out the mortgage. For loans from before 2001, the clock started on 1 January 2001. Homeowners with such loans therefore reach the end of their deduction in 2031.

If you raise your mortgage later, that increase starts its own fresh 30-year term. As a result, you can end up with loan parts running on different clocks. Your oldest part may be close to its end date, while a part added during a renovation still has most of its term ahead.

This affects how you look at refinancing. Moving an existing loan to a new lender does not reset the clock on that debt. Your deduction continues where it was. Only genuinely extra borrowing gets a new term, and only when it meets the purpose and repayment conditions.

When a term ends, your net monthly cost rises because the tax discount on that part stops, while your gross payment to the bank stays the same. Write down the end date of each loan part, so you know in advance when your net costs change. That helps when you choose a new fixed rate period.

Claiming it in your tax return or as a monthly refund

You don’t need to apply separately for the deduction. It happens automatically when you file your annual tax return. The Belastingdienst usually pre-fills the interest from your lender, so you mostly review and confirm the figures. Check the interest, the WOZ value and the outstanding balance against your lender’s annual statement.

If you arrived in the Netherlands during the year, you file an M form. That is the migration-year tax return and covers the full calendar year, with separate treatment of the periods when you were and were not resident in the Netherlands.

You don’t have to wait a year for the money. You can ask for a voorlopige aanslag, a provisional assessment. It pays your deduction out in monthly amounts across the year. In the example above, the €3,981 would then reach you in twelve monthly instalments instead of one lump sum.

Update your provisional assessment after refinancing. A lower rate means less interest, so your monthly refund should drop as well. If you keep the old figure, you may have to pay back the difference when the final assessment arrives.

Refinancing, renovating and using your surplus equity

When you refinance, the loan’s purpose still decides what you can deduct. Your existing eigenwoningschuld can move with you and keeps its deductible status. If you raise the loan for something other than your home, the interest on that extra amount is not deductible. Penalty interest you pay when refinancing can also be deductible. Check this in your return, because the details depend on how you refinance.

Borrowing for a renovation can count as qualifying debt, and that includes sustainable home improvements. Keep invoices, so you can show what the money went into.

Some one-off costs of obtaining a mortgage are deductible in the year you pay them. These include valuation costs, advice fees, notary fees for the mortgage deed and NHG costs. Transfer tax, estate agent commission and notary fees for the deed of conveyance are usually not deductible.

Equity that stays in your home, or that you use for a new home or improvements, remains tax free. If you cash it out to savings or investments, that money falls under Box 3, and the interest on the part you borrowed for that purpose is not deductible. If you sell and buy another home, the bijleenregeling applies: you are expected to put the surplus equity from your old home into the new one. If you don’t, the interest on that part of the new loan is not deductible.

How the deduction changes a refinancing comparison

A lower rate looks attractive at first sight. But the tax effect varies by loan part, by bracket and by remaining term. A lower rate lowers your interest, which also lowers your deduction, so the real saving lies in the difference in net costs.

A fair comparison therefore puts both offers side by side after tax. Add any penalty interest, check the remaining deduction term on each part and look at your bracket.

Bluebird compares lenders and shows you the net monthly costs of each option, including the effect of the deduction. We put the tax side into plain figures that you can check yourself.

Read also: How expats can get a mortgage in the Netherlands.

Conclusion

The mortgage interest deduction lowers what your own home costs you, at a maximum rate of 37.56% in 2026, minus the effect of the eigenwoningforfait and, for loans from 2013, only when repaid on an annuity or linear schedule. You can deduct for up to 30 years per loan. The deduction happens automatically through your annual tax return, and a provisional assessment pays it out monthly.

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