Dutch Tax Authority
As an entrepreneur, you regularly make investments in your business. Think of a new laptop, a company car, or machinery. But did you know that you are not always allowed to deduct the full amount of such an investment from your profit in one go? This is due to depreciation rules.
Below, we explain what depreciation is, how to calculate it, and which rules apply to entrepreneurs in the Netherlands.
Depreciation is the gradual deduction of the cost of a business asset over several years. This applies to business assets that:
cost more than €450 excluding VAT
have a useful life of more than one year.
For example, if you purchase a business laptop for €1,500, you are not allowed to deduct this cost all at once. Instead, you must spread the cost over multiple years.
The most commonly used method in the Netherlands is linear depreciation. This means you depreciate the same amount each year.
Formula:
(purchase price - residual value) ÷ by the number of years of use = annual depreciation.
Example:
You buy a MacBook Pro for €1,929 and expect to sell it after five years for €500.
👉 (€1,929 minus €500) ÷ by five =€285.80 depreciation per year.
This means you may deduct €285.80 as an expense each year in your bookkeeping.
According to the Dutch Tax Authorities, you must depreciate business assets that cost more than €450 excluding VAT and last longer than one year. Common depreciable assets include computers, laptops and tablets, company cars and transport vehicles, cameras and professional equipment, machines and tools, and office furniture.
Common depreciable assets include:
💻 Computers, laptops & tablets
🚗 Company cars & transport vehicles
📸 Cameras and professional equipment
🛠️ Machines & tools
🪑 Office furniture & fittings
No depreciation required for:
‣ Expenses under €450, as these can be deducted immediately.
‣ Inventory is processed separately in your administration.
‣ Software subscriptions are directly deductible as business expenses.
The Dutch Tax Authorities apply specific depreciation rules to certain assets:
∙Maximum depreciation: You may not depreciate below 10% of the purchase value
∙ Business property: Depreciation is limited to the WOZ value of the property
∙ Environmentally friendly investments (MIA/VAMIL): Additional depreciation benefits may apply.
Tip: Check whether your investment qualifies for tax incentives such as the KIA (Small-scale Investment Deduction).
✓ Lower tax burden: Depreciation reduces your taxable profit
✓ More realistics financial overview: Your bookeeping reflects the value of your assets
✓ Predictable costs: Fixed annual depreciation supports financial planning
∙ Choosing an incorrect depreciation period
∙ Depreciatiing too much or too little, which can lead to corrections or penalties
∙ Not accounting for residual value in your calculation
Depreciatin is a key part of healthy financial administration.
By dpreciating business asets correctly, you:
✓ Pay less tax at the right time
✓ Avoid errors in your bookkeeping
✓ Make better financial decisions
Want to be sure your depreciation is handled correctly?
Sarabel supports entrepreneurs with professional bookkeeping and tax advise, so you can focus on growing your business.