Labour costs compensation (LKV) for employing disabled persons

Do you have a company in the Netherlands and do you take 1 or more people into employment who have difficulty finding work? For instance people on incapacity benefit or people who have occupational limitations? You may be eligible for financial compensation via the Labour Costs Compensation (Loonkostenvoordeel, LKV, in Dutch).

When do you qualify?

In order to receive Labour Costs Compensation (LKV), the employee you hire must belong to one of the following groups:

• persons with an occupational disability entering your employment for the first time
• persons eligible for protected employment placements as described in the so-called Access to work programme (Banenafspraak), an agreement between government and employers to improve the participation of this group in the labour market (in Dutch)
• persons with an occupational disability reassigned within your organisation

You can find the conditions for each target group on the Employment Insurance Agency’s website (in Dutch).

No more Labour Costs Compensation (LKV) for older employees

From 1 January 2026, the Labour Cost Compensation (LKV) has been discontinued for the target group of older employees (in Dutch). As a result, you will no longer receive the LKV for employees aged 56 or older who joined your company on or after 1 January 2024. For older employees who started before 1 January 2024, you will still receive LKV until 1 January 2027 at the latest.

How long can you receive LKV?

For persons with an occupational disability who are newly employed, you can receive up to 3 years of Labour Cost Compensation (LKV). For employees who fall under the Acces to work programme, you can receive LKV during the entire period that they are employed by you. For reassigned employees with an occupational disability, you can receive up to 1 year of LKV.

How to apply?

You apply for the LKV with your wage tax declaration. For this you need a copy of the LKV target group declaration (doelgroepverklaring) from your prospective employee. Your prospective employee can apply for an LKV target group declaration (in Dutch) from the Employment Insurance Agency (UWV) if they belong to one of the target groups listed above.

You can also apply for a target group declaration yourself, if your employee has authorised you (in Dutch).

You do not require a target group declaration for persons from the Access to work programme.