The Small Scale Investment Allowance (KIA) is a tax scheme that allows entrepreneurs to get tax benefits on their investments. By making smart use of the KIA, you can deduct part of your investments from your taxable profit, thus paying less tax. In this article, we explain how the KIA works in 2025, which business assets are eligible and how to take full advantage of this scheme.
What is the small-scale investment allowance (KIA)?
The small-scale investment allowance (KIA) is a tax scheme that encourages entrepreneurs to invest in business assets. By making use of the KIA, you can deduct an extra amount from your profit, thus paying less tax. The deduction depends on the amount of your investments in a year.
Conditions for the KIA in 2025
To benefit from the KIA in 2025, you must meet the following conditions:
- Total investment in a year should be between €2,901 and €392,230 lie.
- They must be operating assets that minimum €450 each costs.
- Your company is based in the Netherlands and is subject to income or corporate tax.
- You may not use the scheme if the investment is funded by a government grant.
How much tax benefit does the KIA offer in 2025?
The deduction you get depends on the total amount of your investments. The higher your investment, the lower the deduction percentage.
Table of deduction rates for 2025
| 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% |
Source: tax authorities
Calculation example
Suppose you invest € 75.000 in business assets. You then fall into the category of € 70.603 – € 130.744, which means you have a fixed deduction amount of € 19.769 receives. This will lower your taxable profit and you will pay less tax.
Which business assets are eligible for the KIA?
Not all business assets are eligible for the KIA. Below you can see which investments do and do not count towards this deduction scheme.
What does count?
The following business assets are eligible for the KIA:
- Laptops and computers
- Machines and tools
- Office equipment (desks, chairs)
- Electric vans (subject to conditions)
What doesn't count? (exceptions)
Not all investments are deductible under the KIA. Exceptions are:
- Passenger cars without business addition
- Business assets previously used for KIA
- Premises and land
- Goodwill and permits
How can you apply KIA?
You apply the KIA in your tax return:
- Keep track of all your investments and make sure you have invoices and proofs.
- Enter the total amount of investments in the tax return under the investment deduction.
- The Inland Revenue automatically calculates the deduction, based on the applicable percentages.
What is the disinvestment allowance?
If you sell an asset within 5 years of applying KIA, you may have to repay part of the deduction. This is called the disinvestment addition. This prevents abuse of the scheme and ensures that entrepreneurs cannot use the deduction for quick resale.
Conclusion
The small-scale investment deduction (KIA) is an attractive way to get tax benefits on business investments. By investing smartly and taking into account the conditions, you can take full advantage of this scheme. Make sure you do not sell any assets within 5 years to avoid the disinvestment addition. Plan your investments strategically and make the most of the KIA in 2025!
