If you own a business in the Netherlands, you can accrue a retirement reserve (oudedagsreserve) (in Dutch) by setting aside part of your profit every year. By doing so, you can postpone paying taxes over this amount until retirement. There is a maximum you are permitted to set aside each year.
You are permitted to convert all or part of your retirement reserve into an annuity (lijfrente), the premium of which is then tax deductible.
When do you qualify?
- You meet the hours criterion (described on the page Entrepreneur's allowance).
- You have not reached the State Pension age at the start of the calendar year.
How to apply?
You must state on your income tax return that you wish to add an amount to your retirement reserve. If you wish to convert your retirement reserve into an annuity, you must include a request accordingly with your income tax return. Conversion requests may be submitted continuously.