New year, new budget … and maybe a new subsidy for your business. With the Netherlands aiming to be emissions-free by 2030, now might be the right time to invest in green energy sources (e.g. electric cars or bikes, solar power, etc.) for your business. In this article, Blue Umbrella explains everything you need to know about making green investments in your business and the subsidies you can receive in the Netherlands.
Government incentivesThe good news is that the Dutch government has created incentives for businesses which invest in green, sustainable equipment. The bad news is that there are new rules about these incentives to follow. If not, you will miss out on the opportunity.
Allowances and deductionsIn 2023, there are several changes regarding investing in electric equipment for your business. The first change is a new budget for the 2023 year. The second is that the energy investment allowance (EIA) and the environmental investment deduction (MIA) have been combined into one measure.
According to tax experts, you can’t combine these measures if you want to invest in energy-saving tools. Also, you have to claim these investments within three months after purchase because in order to get a special subsidy, you need a number for your tax filing.
The Energy Investment Allowance (EIA) for entrepreneursThe Netherlands Enterprise Agency (RVO) offers the Energy Investment (EIA) Scheme which gives a tax perk for businesses and entrepreneurs. The scheme is meant for entrepreneurs who invest in energy-efficient business assets and tools.
The EIA is useful for stimulating entrepreneurs to invest in energy-efficient techniques such as conserving energy, reducing carbon emissions and using renewable energy.
Who is the EIA for?Keep in mind that the EIA is not available for individuals. It is meant for all entrepreneurs who must pay income tax or corporation tax.
Furthermore, if you make a green business investment, between 2.500 euros to 126 million euros, you can deduct up to 45.5% of the investment costs from your taxable profit.
In 2023, the Dutch government is investing 100 million euros more for this deduction than in 2022, with a total of 249 million euros in the pot.
The Environmental Investment Deduction (MIA) and The Random Depreciation of Environmental Investments (Vamil)As mentioned above, the scheme has now been combined into one measure. Now, you can pick either one of the schemes or both for your green assets.
The Environmental Investment Deduction (MIA)The Environmental Investment Deduction (MIA) can be used to deduct part of your green investment costs. This deduction can amount to roughly 45% alongside your normal tax deduction – reducing your overall tax burden.
Investments must cost, at minimum, 2.500 euros. It may include things like new components, production or modification costs, and environmental consultancy for small and medium-sized enterprises.
Random depreciation of environmental investments (Vamil)You can also receive a further perk from the Vamil scheme, which allows you to write off 75% of your investment. In total, MIA / Vamil can make up to over 14% of the investment cost.
Requirements for the tax benefitsIf you wish to use the MIA or Vamil tax benefit in your tax return, the investment must be included the Netherlands Enterprise Agency’s (RVO) annual Environmental List.
In 2023, the rules have tightened for solar panels and batteries. These items only qualify for energy subsidies if they contribute significantly to the Dutch energy transition goals.
Additionally, high energy prices have reduced some subsidies. This is because the government believes that businesses will quickly earn back their investments in cost savings, without the need for extra government financial support. Some examples include LED lighting, gaseous CO2 transmission lines for greenhouse horticulture companies and energy-efficient cooling techniques for server rooms.
Don’t miss out on the subsidy!Check the RVO’s rules and make sure you don’t miss out when you are making green investments for your freelance business or company in the Netherlands.
For help and advice on your Dutch taxes, visit Blue Umbrella. Their advisors guide expats through their specific tax situation. Contact them by calling +31 (0)20 4687 560 or emailing them at [email protected].