Starting points for the entrepreneur

Lower SME profit exemption

The SME profit exemption is a deduction from your profit. You are eligible for this deduction if you have one or more businesses. The deduction is a percentage of the annual profit achieved by these businesses. This percentage has been reduced from 13,31% to 12,70%. The SME profit exemption is not part of the entrepreneur's deduction. You do not need to meet the hours criterion that applies to the self-employed persons' deduction, for example. You apply the SME profit exemption to the profit after deducting the entrepreneur's deduction.

Note
Did your business suffer a loss? Then the SME profit exemption reduces the deductible loss.

More deductions for research and development work

Innovative investments are stimulated through the research and development (R&D) scheme. Through this scheme, you can reclaim a portion of your R&D costs. To this end, the maximum R&D deduction has been increased from €15.551 (in 2024) to €15.738. You are eligible for the R&D deduction if you meet the hours criterion (in principle, at least 1.225 hours spent on your business) and have spent at least 500 hours on research and development, for which the Netherlands Enterprise Agency (RVO) has issued an R&D declaration.
Are you a start-up entrepreneur? Then the R&D deduction amount will be increased by €7.875 (in 2024: €7.781). You qualify as a start-up entrepreneur if you were not an entrepreneur in one or more of the five preceding calendar years and have received an R&D declaration for a maximum of two of the five preceding calendar years.

Statement of amounts paid to third parties

Are you an entrepreneur with no employees (so you don't have a payroll tax number) and have you received an invitation from the Dutch Tax and Customs Administration to provide information on amounts paid to third parties for 2024? Then you are obligated to provide this information (without a citizen service number!). If you did not receive an invitation, you are permitted to provide information on amounts paid to third parties. This concerns the following information:

• the amount you have paid out;
• the date on which you paid out the amount;
• name, address and date of birth of the person to whom you paid the amount.

This primarily concerns payments that are typically included in the taxable income from other activities. Excluded are payments to employees, artists, professional athletes, volunteers, and individuals who have issued a VAT invoice. You must therefore submit data on individuals who issue invoices without VAT, do not issue invoices, or invoices with VAT reverse-charged. You must submit the data for 2024 no later than 31 Januari 2025 Submit your application digitally to the Tax Authorities. You have two options: via the data portal or via Digipoort.

Phasing out the self-employed persons deduction

Just as in 2024, the self-employed person's tax deduction will be reduced by €1.280 this year. As a result, this deduction will amount to €2.470 in 2025 (in 2024: €3.750). In 2026, the reduction will be €1.270. In 2027, the self-employed person's tax deduction must be reduced to €900. In principle, you are eligible for this deduction if you:

• are younger than the AOW retirement age and
• at least 1.225 hours and
• Spend 50% of your total working time on work for your company.

If you have reached the AOW retirement age at the beginning of the calendar year and you meet the hours criterion, you are entitled to 50% of the deduction.

Tip:
Make sure you regularly keep a timesheet of the work done for your business, so you can easily demonstrate that you have met the hours criterion.

Changes to VAT on virtual services

Do you provide virtual services to customers in another EU Member State? Then the following is important for you. Since 1 Januari 2025 The place of supply has changed, meaning that VAT is levied in the Member State of the recipient of the cultural, artistic, sporting, scientific, educational, or entertainment service. Until 1 January 2025, VAT was still levied in the Member State of the service provider.

Is the customer a VAT entrepreneur? Then you can transfer the VAT to the customer. You don't have to declare VAT yourself. Is your customer a private individual? Then you cannot transfer the VAT, but you can file a simplified VAT return through the One Stop Shop. You then file a VAT return with the Dutch Tax and Customs Administration for all your virtual services in other EU Member States. You pay the VAT due to the Dutch Tax and Customs Administration, which then transfers the VAT to the tax authorities of the various Member States where your customers are located. If you don't use the One Stop Shop, you must register and file VAT returns in all Member States where your customers are located.

Tip:
If you provide virtual services in another Member State, make sure you adjust your administration and invoices accordingly.

Transitional arrangement for reversed VAT increase suspended

At the end of last year, it was decided to temporarily postpone the proposed VAT increase on media, culture, and sports, effective January 1, 2026. This was conditional on finding an alternative within the VAT domain that yields the same amount as the increase in the reduced rate. More information on this will be announced in the spring. A transitional arrangement was also included for this VAT increase. This meant that the 21% rate (instead of the 9% rate) would apply to vouchers sold in 2025 and advance payments for the aforementioned activities taking place in 2026 or later. Now that the VAT increase has been (temporarily) postponed, it has been decided to temporarily suspend this transitional arrangement until July 1, 2025. For advance payments and sales of vouchers for services performed in 2026 or later up to July 1, 2025, you may therefore charge the 9% rate. After that date, the 21% rate will apply.

Pay attention to VAT deadlines for real estate

Did you choose to make the transfer subject to VAT when purchasing or selling real estate? In that case, the buyer must issue a written statement to the seller and the Tax Authorities within four weeks of the end of the financial year following the one in which the property was transferred to them. This statement must demonstrate that the buyer actually used the property for 90% (sometimes 70%) or more for taxable transactions in both years. For a taxable transfer in 2023, this must be done no later than 29 Januari 2025.

Taxable rental
In the case of taxable rental of a property, the tenant who no longer meets the 90% (or sometimes 70%) criterion must report this to the landlord and the Tax Authorities within four weeks after the end of the year.

Supplementary margin scheme amended

Did you, as a reseller (dealer), purchase antiques, art, or collectibles at the reduced VAT rate before January 1, 2025? Or did you import these goods or acquire them in another EU country (intra-Community acquisition)? Then you could apply the supplementary margin scheme when you resold these goods. You then only paid VAT on the difference between the purchase price and the sale price. This has changed. Since 1 Januari 2025 You can no longer apply the supplementary margin scheme. If you already purchased the goods but did not sell them before January 1, 2025, you can deduct the VAT on the purchase in the first VAT period of 2025.

Issuing of MIA and Vamil decision

 Starting in 2025, the Netherlands Enterprise Agency (RVO.nl) will issue a decision for registered investments for the environmental investment deduction (MIA) and the arbitrary depreciation of environmental investments (Vamil). Objections and appeals against these decisions will then be possible, just as was already possible for the energy investment deduction (EIA). Furthermore, the environmental expert assessment of the registered investment has been transferred from the Tax and Customs Administration to the RVO.

Starting points for the managing director

Changes in box 2

Box 2 has two tax brackets. The first bracket, with a rate of 24,5%, applies from January 1, 2025, to Box 2 income (for example, dividends or the profit from the sale of your substantial interest shares) up to €67.804 (in 2024: €67.000). Do you have a tax partner? Then the low Box 2 rate applies up to €135.608 if you divide the tax equally between you and your partner. The rate for the second bracket has been reduced from 33% to 31%.

Avoid paying tax interest

The interest on corporate income tax (withholding tax and solidarity contribution) has been reduced from 10% to 9%. You may face interest on your tax if your private limited company (BV) has to pay additional corporate income tax. You can avoid this by making a realistic estimate of the corporate income tax due and adjusting the provisional assessment accordingly.

Note
From 1 January 2025, tax interest will also be charged for late payment of dividend tax.

Usual wage 2025

As a substantial interest holder (5% or more shareholding), you must receive at least a customary salary for the work you perform for your BV. The customary salary is generally set at the highest amount from the following range:

• the salary from the most comparable employment relationship;
• the highest salary of employees employed by the company or affiliated companies; or
• €56.000 (equal to 2024)

Request provisional loss settlement

If your private limited company incurred a loss in 2024, you can request a provisional loss offset as soon as your 2024 corporate tax return is filed. You can then offset 80% of the loss against profits from previous years. This provides your private limited company with a liquidity advantage, as it can access an expected tax refund sooner. The provisional loss offset will later be offset against the final loss offset.

Adjustment of the waiver exemption in the event of overlap with loss offsetting

Since 2022, your private limited company (BV) has been limited in its ability to offset losses from other years if it generates a profit of more than €1 million. In that case, it can only offset losses from other years against a maximum of half of its annual profit. Your BV therefore pays corporate income tax on the remaining half, even if it still has deductible losses from other years. This loss-offsetting measure also affects the exemption for waiver profits. This profit arises when a creditor waives its right to collect a debt from your BV and is exempt from corporate income tax to the extent that it exceeds all outstanding deductible losses. Do you have a (loss-making) BV? Then, due to the limitation on loss offset, your BV may not be able to offset all outstanding losses against the waiver profit achieved, meaning that your BV will still have to pay corporate income tax on part of that profit. This is because the waiver profit exemption only applies to the waiver profit to the extent that this profit exceeds all outstanding losses (including losses your BV cannot offset in the waiver year). The combination of limited loss offset and the waiver profit exemption leads to an undesirable outcome. Therefore, these obstacles are being removed by fully exempting the waiver profit from corporate income tax. Simultaneously, the loss offset reserve is reduced by this amount if the losses to be offset exceed €1 million.

Preventing double counting when borrowing excessively

The threshold above which you must pay Box 2 tax on debts to your own private limited company (BV) remains at €500.000, the same as in 2024. At the end of 2025, the Tax Authorities will review your debt burden to your own BV.
However, with regard to excessive borrowing, unintentional double counting of debts from partnerships occurred. To prevent this, certain debts will now be disregarded. This double counting occurs if you are a participant in a partnership but also have a substantial interest in a company, and this company has provided a loan to that partnership. In this situation, double counting of debts and obligations is excluded from the definition of debt.

This publication reflects the current state of legislation and regulations up to and including January 1, 2025. While every care has been taken with the content, we cannot fully guarantee any errors, typographical errors, or omissions. The editors, publisher, and distributor hereby disclaim liability for such errors. For further information, please feel free to contact us.