WHAT BUSINESS COSTS AND EXPENSES ARE DEDUCTIBLE?
You may declare any expenses you need to make your services / sales of your business a reality.
According to the tax authorities, you may deduct these business costs. You do this twice:
- with the sales tax / VAT return. Most entrepreneurs have 9% or 21% VAT on almost everything you sell or pass on to the customer (such as expenses incurred). Almost everything you buy also includes VAT (mnemonic: By the way). VAT received on your invoices (turnover) – VAT paid on your expenses (input tax) = VAT that you have to pay to the tax authorities.
- also the annual income tax return: the lower the profit, the lower the tax. Because: Turnover – expenditure = profit. And you pay tax on profit, not on your turnover or income.
So if you know how to recognize business costs and if you keep your receipts, you pay less tax to the tax authorities. In order to provide insight into which business costs apply to self-employed persons, we have made an extensive overview on this page with a number of useful tools.
Strict business costs
A number of costs are clearly business-like. When considering whether something is business, do not try to view the situation from the tax auditor’s perspective. If you buy a company asset that lasts longer and is more than € 450 it could be an investment. Read here what this means.
Your subscription with the Chamber of Commerce, KvK (exempt from VAT, so 0%)
The rent of a business space (exempt from VAT or taxed at 21%, if agreed)
Payments for work by fellow self-employed workers (also known as: work by third parties)
Marketing costs for your company.
Partially business-like and partly private
In these situations, only the business part is deductible. With travel costs it is important that you only enter the trips that are business as we can not guess the nature of your trip. However, we apply private corrections about, for example, mobile phone costs or lunch and dinner costs at the end of the year. That means that you enter the entire invoice amount.
Travelcosts (on public transport the VAT is 9%)
Mobile phone costs
Food and beverage costs (always note 0% VAT, even if it says 9% or 21% on the receipt)
Business or private?
Some costs can be both business and private. This is often debatable. Where a Museum annual pass is unthinkable for one entrepreneur, it could be explainable to an art history teacher. The same goes for clothes.
Example (Work related) clothing
This must be evident from the external characteristics of the clothing (e.g. overalls, uniform or work shoes)
If the clothing can also be worn outside work: provided with a logo with an area of> 70 cm2 and that refers to your company.
Special clothing for (stage) artists that you would not have bought or worn otherwise
Travel costs
Car registered to your company
Do you have a company car? Then you can also drive it privately. For this you pay an addition or receive a private correction. Keep in mind that you decide to drive for business or pleasure as soon as you purchase the car.
Nice to know In general, a car older than 15 years is advantageous for business driving. If your car is younger than 15 years, business driving is beneficial if the catalog value is low and you drive many kilometers for business.
Private car: kilometer registration
Did you buy a car privately? Then you can also drive it for business. You keep these kilometers in your kilometer registration.
Conditions for kilometer or trip registration
Date
Place of departure and destination
Amount of kilometers
Beginning and end of odometer
Business Purpose
Handy facts
Biggest differences business or private
Business driving with a private car? Then you are not allowed to declare any costs (such as petrol and parking costs) and only € 0.19 cents per kilometer driven. You enter this in your expenses and you prove it by a thorough kilometer registration.
Business car: all costs such as insurance, parking costs, fuel bills and repair costs are business related.
Whether you have to buy a car for business or private purposes depends entirely on the situation. That is why we have developed two tools: one that helps you with this choice and one for your kilometers.
Handy tools
Public transport
If you have a business NS card, enter everything. Do you travel for both business and private purposes with a public transport card? Then you only enter business trips.
Rented vehicle
Even if you rent a car or van for business purposes, you can include all receipts and invoices in your administration.
Business travel abroad
Now you may have to travel (regularly) for work. You can also declare costs that you incur for this. However, this does not apply to trips that also (largely) count as private trips.
Handy facts
Public transport travel: no individual rides
Go to mijnns.nl
Select a monthly or quarterly printout and uncheck your private trips
Add this total overview to your expenses in Your Bookie WebApp
Handy tools
Communication / marketing
As an entrepreneur for income tax purposes, you must market yourself visibly, be accessible and show that you are working on acquisitions. Keep in mind that with your communication and promotional costs, as with (almost) all your other expenses, you also need an invoice or receipt with the VAT statement that is addressed to your company (or you as a person). You can only reclaim VAT if it is stated on the receipt.
If your telephone subscription is partly redemption of the device, you must enter this part on a separate line “Redemption Telephone”.
Common costs
Telephone costs, both your telephone and your phone bill
Internet at the office (so not at home, unless you need faster internet for work)
Website design and monthly / annual server costs
Design / branding costs
Promotional costs on Social Media, such as Google, FB, LinkedIn and Insta Ads.
Business cards, stickers, cards, prints and flyers.
Subscriptions/contracts
Subscription accountant and software
If it is conveniently arranged, you have a direct debit for recurring costs such as (accounting) software. Remember you should still have an invoice for this. At The Bookie you pay via direct debit. We add the corresponding invoices directly to your expenses. This way you no longer need to process it yourself.
Workspace
Do you rent an office, studio or workspace for business? Then you may include these costs in your administration. Check whether your rent is exempt from VAT or whether you can reclaim the 21% VAT.
Many freelancers work from home and regularly ask us whether it is possible to increase (part of) the mortgage or rent for business purposes. These costs of that workspace or a home office are deductible in a very limited number of cases. Check via the button on the right (Dutch Tax site so Google Translate) whether your workspace at home is eligible for deduction.
Common Costs
Rent workspace
Insurances, such as professional and corporate liability insurance (which is exempt from VAT)
Bank costs can be found on your printout of the quarter or year (exempt from VAT)
Software like Adobe. VAT has often been reverse-charged. You can indicate this in the expenses at “btw verlegging”
Handy tools
Knowledge: training & deepening
Even if you already are an entrepreneur, you’ll always continue developing yourself. The costs must be relevant for your industry and should be in order to extend your knowledge base. Costs for new knowledge (in another discipline) are seen as private costs. These costs may be deducted of your income tax as educational expenses.
Common Costs
Courses, training courses, seminars and workshops
Professional literature
Investments or foreign costs
Investments
Assets that you buy for your business and need to be able to make your products or provide your services can be an investment. This includes machines, means of transport, tools, inventory, goodwill or permits.
VAT paid in an EU country
Have you bought goods, services or imports in another EU country and paid VAT there? Then you cannot deduct the VAT in your Dutch VAT return. You then enter these costs including VAT and set the VAT percentage to 0%.
Shifted incoming invoice
With invoices from Facebook, Google and Adobe you often see on the invoice “VAT to be accounted for by the recipient” or something in that direction. In this case you indicate “Shifted within EU” when VAT percentage 21%.
Reclaim VAT
However, you may be able to deduct this VAT in your foreign declaration or reclaim it from the EU country via the Dutch tax authorities. You can use your Bookie for this, but this is only worthwhile in the case of larger amounts as these hours are not included in the subscription.
Intra-Community acquisition or reverse charge VAT
Have you purchased services or goods from an entrepreneur from another EU country (this is called an intra-Community acquisition or ICP in Dutch) or has the VAT been transferred to you? Then you calculate the VAT amount yourself. You state this in your Dutch VAT return. If you use the goods or services for taxed turnover, you deduct the VAT as input tax at the same time. Since you give it up and then deduct it, you pay nothing at the bottom of the line: just like with domestic business costs.
When you are with us, we do that for you.
Handy facts
With investments this is how we work
You declare assets that will last for a number of years and cost more than € 450 as an investment. Is this not correct? Then your Bookie will correct this.
We depreciate the purchase price of the investments
We arrange your Investment Deduction (KIA)
Advise with foreign business expenses
For expenses that include foreign VAT, enter the total amount in the amount including VAT and set the VAT to 0%
If you order things online abroad, you should try to state your VAT number as much as possible, so that the VAT can be reversed to you.
NOTE If there is no VAT on an invoice, you may not reclaim VAT. For example, a pin receipt or an email from bol.com (unless stated on it) is not an official invoice. It is tempting to increase these costs anyway if you know that the product does show VAT, but this is not allowed unless you have the receipt with VAT.
