Generally speaking, there are three types of tax deductions:
- entrepreneur deduction and SME profit exemption
- investment deduction
- tax reserves
You cannot simply include these deductible items in your tax return. As an entrepreneur, you must fulfill all kinds of conditions set by the tax authorities. Take a good look at this and ask for advice from an accountant or accountant.
Below we describe the most important deductions in a nutshell. Want to do a quick check to see if you qualify? Then start the free independent deduction scan >>
1. Entrepreneur’s deduction and SME profit exemption
The business deduction relates to various tax deductions. These may be of interest to entrepreneurs in general, starting entrepreneurs or entrepreneurs with business partners. These are the following deductions:
These deductible items are conditional, among other things, on the fact that the Tax Office must regard you as an entrepreneur. In most cases, you must also meet the hours criterion.
Additional conditions may also be imposed. You will find the current conditions and amounts for each deductible item on the Tax Authorities’ website.
Independent deduction down
The self-employed deduction provides less benefit since 2020. The deduction is reduced to the so-called basic rate in four annual steps of 3 percentage points. In 2021 you were allowed to deduct €6,670, in 2022 it is €360 less and therefore €6,310.
SME profit exemption
You get the SME profit exemption if you are an entrepreneur. You use this tax deduction after you have reduced the profit with the entrepreneur’s deduction. Of course, there must still be sufficient profit left for the SME profit exemption.
2. Investment deduction
As with the business deduction, the investment deduction relates to various tax deductions. These can be interesting for entrepreneurs who make (larger) investments in certain business assets. These are the following deductions:
These deductible items are conditional, among other things, on you being subject to income or corporation tax.
Additionally, not all business assets qualify. You also need to take into account minimum investment amounts. You will find the current conditions and amounts for each deductible item on the Tax Authorities’ website.
In some cases, you must repay part of the investment deduction. This is possible if you dispose of business assets (such as purchases or donations) for which you have claimed investment deductions in previous years. This is called a disposal allowance.
3. Tax reserves
In addition, there are also some tax reserves that you can take advantage of as an entrepreneur, namely:
The reinvestment reserve is a first example of a fiscal reserve. With this, you reserve an amount and, as with other deductible items, you reduce your taxable profit. With the reinvestment reserve, you do this by reserving the proceeds from the sale of a business asset for the purchase of another business asset.
The condition is that you actually intend to reinvest in a business asset on the balance sheet date. You must also take into account rules for depreciation of the reinvestment reserve. It is also possible for the reserve to be released in a number of situations, including if you decide not to reinvest.
Do you incur high costs once every few years for periodic maintenance of assets? For example for the maintenance of your business? Then the equalization reserve can be interesting.
You may not create an equalization reserve for annually recurring expenses or purchases of company assets. In addition, you must take into account a wide range of other conditions. You can find it on the Tax Agency’s website.
old age reserve
The old-age reserve is a fiscal reserve that functions as a kind of separate pension scheme. This is a reservation of part of the profit. The result is that you temporarily pay less tax. Later, however, you must pay income tax on your retirement reserve. Or you have to buy an annuity for it.
If you want to create an old-age reserve, Tax must consider you an entrepreneur, and you must meet the hourly criterion. You may also not have reached state pension age at the start of the calendar year. At that time, any retirement reserve is cancelled.
Before creating a retirement reserve, it is wise to get advice on this. There are all kinds of hooks and eyes for this event. It is possible, for example, that you pay income tax on the reserved amount sooner than expected. For example, when you close down your business.
Have you already sent your tax return and have you forgotten a deductible item? If a final assessment has not yet been imposed for this, you can complete the tax return. You then still offer your data, now with the one deductible item. That way, you can still take advantage of a deduction.
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