Do you own a company in the Netherlands and do you invest in environmentally friendly business assets or technology? You may be eligible for the environmental investment allowance (milieu-investeringsaftrek, MIA). You can deduct a percentage of your investment costs from the taxable profit. This is in addition to the regular depreciation. As a result you pay less taxes.
The deduction concerns the following costs:
- purchase costs
- production costs (costs for use of your own staff, your own materials, and activities by third parties under your direction)
- modification costs
- the cost of purchasing new components
- the cost of environmental consultancy (only for SMEs)
If your project does not generate profit, you may settle this with previous years (carry back) or upcoming years (carry forward).
How much can you deduct with MIA?
To find out which percentage (27%, 36%, or 45%) applies to a specific business asset, you can check the Dutch-language Environment list tool (Milieulijst).
When do you qualify?
To apply for the MIA scheme you must meet several conditions, such as:
- Your company is registered in the Netherlands, Aruba, Curaçao, St. Maarten or special Dutch municipalities Bonaire, St Eustatius or Saba and is liable to pay income tax or corporation tax.
- You invest in a business asset that is on the Environment list (Milieulijst) and meets the set requirements.
- You have not used the asset previously.
- You invest at least €2,500 per year.
- You do not simultaneously apply for the energy investment allowance (EIA). You can apply for the MIA scheme in addition to the Random depreciation of environmental investments scheme (VAMIL).
- You report the asset within 3 months of ordering it (obligation to purchase).
Note that MIA is seen as state aid. This means that you need to declare that the total amount of state aid you receive does not exceed the limit. Read all the conditions for MIA (in Dutch).
Do you fail to use the asset within 3 years? Or did you not pay at least 25% of the investment within 12 months? You have to repay part of the allowance via the disinvestment surcharge (desinvesteringsbijtelling, in Dutch).
Do you sell or give away the business assets within 5 years after your investment? Depending on the total value you may have to repay a portion of the allowance via the disinvestment surcharge. For more information, please contact the Dutch Tax and Customs Administration (Belastingdienst).
How to apply?
If you want to use this scheme, you must notify the Netherlands Enterprise Agency within 3 months of having purchased the business resource. After your notification you can declare this investment in your tax return.