The two languages have a very high degree of lexical similarity. The lexical similarity between Dutch and German is over 80%. That means that 4/5 of the two languages’ words are similar. However, that does not mean that they are necessarily mutually intelligible to native speakers due to additional differences in pronunciation and syntax.
While German and Dutch are quite similar in terms of vocabulary, they do differ significantly in terms of grammar. This is mainly due to the fact that Dutch has evolved to have a ‘simpler’ grammar structure.
Grammatical differences are not the only ones that exist between Dutch and German.
Pronunciation of the two languages differs significantly: the same letter combinations are pronounced differently; vowels and consonants that seem the same actually have a different quality to their pronunciation.
The spelling rules are also quite different. For instance, in Dutch, you can’t end a (non-loan) word with two of the same letters. Thus, wil (want, as in German) cannot be written as will. Furthermore, unlike German, nouns are not capitalized in Dutch.
Still, due to their lexical similarity, German and Dutch are somewhat mutually intelligible, although mostly in writing. However, more Dutch people understand German than vice versa because German is taught at school in the Netherlands.