Private business ownership allowance
As an entrepreneur in the Netherlands, you may be eligible for the private business ownership allowance (zelfstandigenaftrek). If so, you pay less tax because you can deduct a fixed amount from your annual gross profit. The private business ownership allowance is an important tax deduction for sole proprietors.
When do you qualify?
The conditions for the private business ownership allowance (in Dutch) are:
- You are an income-tax-paying business owner. The Dutch Tax and Customs Administration (Belastingdienst) offers the Dutch-language tool OndernemersCheck with which you can check if you are an entrepreneur for income tax purposes.
Amount of the allowance
The Dutch Tax and Customs Administration sets the amount each year. You can find the amount you may deduct on their website (in Dutch). The amount for 2025 is €2,470.
The amount you deduct cannot be higher than your profit (before deducting entrepreneur allowance). This does not apply if you are allowed to use the tax relief for new companies. In that case, you may use the amount of the private business ownership allowance, even if it is higher than your profit.
If you have reached the state pension age by 1 January, you can deduct 50% of the amount of the private business ownership allowance.
Unrealised private business ownership allowance
If you are not a new business owner and your profit is less than the private business ownership allowance, then the private business ownership allowance is the same amount as your profit. The part you cannot deduct is the unrealised private business ownership allowance (in Dutch). The Dutch Tax and Customs Administration will offset this part in the subsequent 9 years.
How to apply?
You do not have to apply for the private business ownership allowance. You answer a set of questions in your income tax return. Based on your replies, you receive the allowance or you do not.