Business expenses that an entrepreneur can deduct
26.09.2024Sole proprietors (EMZ/ZZP) can reduce their taxable income tax base by the amount of business-related expenses. These include expenses on a laptop, professional literature, expenses for using a car (for business purposes), and much more, depending on your type of business.
Basic rule: expenses must be truly related to your business.
In this overview, we'll cover the most common business expenses you can deduct as an entrepreneur.
Car expenses
If you use a car for business purposes and the car is on your business balance sheet, you can deduct the following expenses (if any) from your taxable income:
- Cost of interest on financial leasing of a company car,
- Costs for fuel, electricity, repairs and maintenance,
- Car depreciation,
- Motor Vehicle Revenue (MRB),
- Insurance premiums,
- Costs for parking, toll roads, etc.
If the vehicle was purchased for business, i.e. the invoice for its purchase indicates the name of your business and this vehicle is reflected in the balance sheet of your business, then you will be able to return the BTW from its purchase when filing the BTW report for this period.
However, please note that there are many nuances in the question of “entrepreneur and car” (for example, bijtelling), so before buying a car for business, it is better to consult with an accountant.
Deductible Travel Expenses for Entrepreneurs
If you use public transportation to travel to clients or business meetings, you can deduct these expenses from your profits at a rate of 80%.
You can also deduct expenses for other forms of transportation, such as taxis or flights, if they were used for business purposes. The key is to keep evidence of all expenses incurred to prove that they were necessary for the business.
Delovaya literature
If you buy professional literature related to your work, you can deduct 100% of these expenses. It is important that it is truly business literature, and not a fiction novel for a seaside holiday - such expenses cannot be deducted.
Telephone expenses
Subscription and call expenses are deductible if they are for business purposes. As a business owner, your personal and business calls often overlap, so you can only deduct the portion of your expenses that is business related. This can be difficult to track, and proving that some of these calls are business related is quite labor-intensive. Make things easier for yourself by registering your phone subscription in your business name, which will usually ensure that all communication expenses are business related and therefore deductible.
Laptop, computer or printer
If you buy a new laptop, computer or printer for work, these expenses can be treated as business expenses. It is important that you have an invoice in the name of your business or a cash receipt. If the purchase price is 450 euros or more (BTW is discarded), then you may have to amortize this investment, spreading the costs over several years - no more than 20% of its cost is allowed to be written off per calendar year.
This was just a quick overview of the most common business expenses you can deduct as an entrepreneur in 2024. Want to learn more about business administration, bookkeeping, and filing taxes in the Netherlands?
Come to the consultation “Accounting questions for entrepreneurs”.
