Kleinschaligheidsinvesteringsaftrek, or KIA (small-scale investment deduction), is a tax deduction for entrepreneurs in the Netherlands who invest in fixed assets used in their business activity.
Its purpose is to partially lower the taxable base by allowing a defined part of investment expenditure to be deducted from income.
The KIA deduction applies in the annual settlement and concerns investments made in a given tax year. It includes, among others, the purchase of machines, devices, equipment or tools necessary for running the company, provided that the conditions set out in the regulations are met.
Conditions for using the deduction in 2026
To use the deduction in 2026, investments must concern fixed assets used in business activity. The value of a single asset should be at least €450 net, and the total sum of investments in a given tax year must reach a minimum of €2,901 net.
How is the amount of the deduction calculated?
The amount of the deduction within KIA depends on the total value of investments made in a given year.
- from €2,901 to €71,683: 28% deduction of the investment value,
- from €71,684 to €132,746: a fixed amount of €20,072,
- from €132,747 to €398,236: €20,072 reduced by 7.56% of the surplus over €132,746,
- after exceeding €398,236, the KIA deduction is not granted.
What does KIA give you in practice?
Applying the investment deduction allows you to lower the income subject to taxation, which translates into lower income tax. In practice, this means that part of the investment outlays incurred is "recovered" tax-wise in the annual settlement, supporting the development of business activity.
As with other tax deductions, it is essential to correctly classify the investment and properly include it in the tax return.
In case of doubt, it is worth checking whether a given investment meets the conditions of the KIA deduction and whether it has been correctly entered in the return.
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The amount of the deduction depends on the amounts, type of purchase and how the investment is recorded, so it is good to calculate this before the annual settlement.