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Are you discontinuing your business? You may be eligible for discontinuation relief (stakingsaftrek) or a tax-free annuity (stakingslijfrenteaftrek).
Are you making a profit from discontinuing your business? This is called discontinuation profit (stakingswinst). You have to pay tax on this. Calculating tax over discontinuation profit is not straightforward, it is best to seek expert advice.
If you are making a profit from your discontinuation, you may be eligible for discontinuation relief (in Dutch). This means you will pay less tax on this profit. Discontinuation relief is part of the entrepreneur allowance (ondernemersaftrek).
You can use part of your discontinuation profit to pay your annuities. You will be entitled to an additional tax-free annuity. The amount depends on your age and the situation at the time you discontinued your business. Do you want to find out how much you can deduct in annuities and investment on your tax return? You can use the calculation tool (in Dutch).
When do you qualify?
In order to be eligible for discontinuation relief, you must at least satisfy the following conditions:
- you are an entrepreneur
- you earn a profit by discontinuing 1 or more businesses
How to apply?
You apply the discontinuation relief to your income tax return. Do you want to convert discontinuation profit into a tax-free annuity? You also indicate this on your income tax return.