If you invest in assets for your business, you can make use of the investment deduction under certain conditions. This tax benefit reduces your profits, so you pay less income or corporation tax. There are three forms of investment deduction: the KIA, EIA and MIA. There is also the disinvestment allowance, for when you sell an investment within five years.
What is investment deduction?
Investment deduction means that you can deduct part of the investment from profits. This reduces the tax burden. The scheme was created to help entrepreneurs and self-employed people invest more in their business. Think of business assets that are used for business purposes and comply with certain rules.
The investment deduction only applies if the investment amount is high enough and the investment is not excluded. Exclusion occurs in the case of passenger cars, for example. Some schemes require prior notification to the RVO (Rijksdienst voor Ondernemend Nederland). The RVO implements these schemes on behalf of the government and supports entrepreneurs in this.
What types of investment deductions are there?
By 2025, you can benefit from these three types of investment deductions as an entrepreneur or self-employed person:
- Small-scale investment deduction (KIA)
- Energy investment allowance (EIA)
- Environmental investment allowance (MIA)
But beware: you cannot always combine these schemes. This is because you can use the KIA together with EIA or MIA, while you cannot apply EIA and MIA at the same time.
Small-scale investment deduction (KIA)
The Small Scale Investment Allowance (KIA) is for entrepreneurs who invest in business assets. In 2025, the scheme applies to investments between €2,901 and €392,230 in qualifying business assets. This tax deduction reduces your taxable profit. So you will have to pay less tax.
Exactly how much money you can then deduct depends entirely on the investment amount. As an entrepreneur, there are different tranches and percentages. These can be found below:
| Investment (€) | KIA deduction |
| Up to € 2,900 | 0% |
| € 2.901 – € 70.602 | 28% of the investment amount |
| € 70.603 – € 130.744 | € 19.769 |
| € 130.745 – € 392.230 | €19,769 - (7.56% of the amount above €130,744) |
| More than €392,230 | 0% |
This scheme is ideal for you as an entrepreneur or self-employed person. Because even with a low investment, you can benefit substantially from a tax advantage.
Example
OK suppose: you invest €10,000 in a new laptop and software. Then you can deduct 28% from that amount. So that's €2,800. When your tax rate is 36.97%, you save more than €1,035 in tax!
Want to know more about the KIA now? Then dive deeper into our extensive article on the Small-scale investment deduction 2025.
Energy investment allowance (EIA)
As an entrepreneur, do you invest in energy-efficient appliances or sustainable technology from the Energy list? Then you may be eligible for the Energy Investment Allowance (EIA). In 2025, you may deduct 40% of the investment amount extra. This comes on top of your normal depreciation and reduces the profit you have to pay tax on. But be sharp. This is because the investment must be at least €2,500 per asset. You must also report the purchase to the RVO in advance.
Example
Say you buy a €10,000 energy-efficient heating system. Thanks to the EIA, you can deduct an extra €4,000 from tax. As a result, you pay about €1,478 less tax (at a rate of 36.97%).
Environmental investment allowance (MIA)
Then there is also the Environmental Investment Allowance (MIA). This deduction is there for entrepreneurs who opt for environmentally friendly business assets. These must be assets that are on the Environmental List stand. In 2025, there are three different deduction rates depending on the environmental category of the asset.
| Environmental investment | Environmental investment deduction |
| Code F and G | 45% |
| Code A and D | 36% |
| Code B and E | 27% |
Have you reported something for the MIA? Then you will receive an official response from the RFO. Do you disagree with that response? Then you can lodge an objection. Good to know: you cannot use the MIA together with EIA, but you can use it together with KIA.
Example
You buy a €15,000 eco-friendly filter system (with code F). You can deduct 45% from that amount, which is €6,750. As a result, you pay about €2,496 less tax (at a rate of 36.97%).
How to apply for investment deductions?
You don't need to apply for the Small Scale Investment Allowance (KIA). You just fill it in on your tax return. For the EIA and MIA, however, you do have to report your investment to the RVO in advance. You will then receive a statement or decision, which you need for your tax return. Make sure you keep your invoices and other documents well. And report your investment on time, otherwise you will lose your right to a possible deduction.
Note: disinvestment allowance
Have you previously received an investment deduction and do you sell the relevant asset again within five years? Then you may have to repay part of it. We call this the disinvestment addition. This also applies if you donate it or start using it privately. You have to report this yourself in your tax return. In 2025, a limit amount of €2,400 applies. Anything below this amount you don't have to pay anything back.
Example
OK suppose: in 2023 you bought a €5,000 business printer and got a €1,400 deduction. In 2025, you sell the printer again for €3,000. Because you sell the printer within five years and the proceeds exceed €2,400, you have to repay part of that deduction. You do that by adding €3,000 to your profit in 2025.
Common mistakes
While the investment deduction may give you many advantages, entrepreneurs sometimes unintentionally make mistakes. Such mistakes can result in missed opportunities or unexpected tax assessments. Therefore, avoid the following:
- You report your investment late to the RFO
- You are using the wrong codes on the list
- You think all assets are always eligible
- You forget that you have to repay the deduction when you sell something
- You misapply the KIA in collaborations
Conclusion
So the investment deduction can save you quite a bit of tax as an entrepreneur. Especially if you know how to use the schemes smartly. Whether you choose energy-efficient appliances, eco-friendly resources or invest in your business growth: chances are you are entitled to a deduction. But make sure you keep a close eye on the conditions, deadlines and rules. That way, you won't miss out on money or run the risk of having to pay something back unexpectedly.
