Fear of clawbacks keeps eligible households from claiming anything at all, largely because the toeslagenaffaire (the childcare benefits scandal) is still fresh in memory. Ordinary year-end reconciliation is a different mechanism: allowances are paid as advances against an estimate, then settled against confirmed income once the year closes.
Real, but manageable, and worth separating from what you may have heard about the toeslagenaffaire. Every toeslag you receive during the year is a voorschot (an advance) based on an estimate of your income, either one you entered or one carried over from last year. Once the tax year closes, the Belastingdienst runs a definitieve berekening (final calculation) against your actual confirmed income, usually landing sometime in the second half of the following year. If you earned more than estimated, you repay the difference; if less, you get topped up. The single best way to avoid an unpleasant surprise is to update your estimate in Mijn Toeslagen the moment your income changes — a raise, a new job, more hours — rather than waiting for the annual reconciliation to catch up with reality; changes are supposed to be reported within four weeks. This routine process is a different animal from the toeslagenaffaire, where the childcare benefits scheme wrongly accused thousands of families of fraud over often-minor errors and clawed back full amounts, disproportionately hitting people with dual nationality — a scandal that brought down the government in 2021 and is still being compensated today. Ordinary reconciliation doesn't carry that risk; it just settles the math.