The Netherlands actively promotes engaging in Research & Development activities through a favorable corporate tax system and specific R&D incentives that support innovation throughout the entire R&D lifecycle. The following measures may significantly lower company R&D cost and taxable base.
- R&D Tax Credit (WBSO)
Companies performing particular R&D activities may benefit from a 32% tax credit (up to 40% for startups) of the first €350,000 in R&D wage costs and other R&D expenses and investments, and 16% for those costs and investments exceeding €350,000.
- Innovation Box
Companies may benefit from an effective tax rate of only 7% for income from intangible assets— including technological innovations—created by the Dutch tax payer and for which R&D tax credit was received.
- Allowance for public-private partnerships in R&D (PPS allowance)
R&D partnerships between public entities and private partners may receive cash grants of 40% on the private investment costs for the first € 20,000 and 30% for the excess. The cash grant has to be invested in the R&D project of the partnership.
- Innovation Credit
Innovation Credit is a risk bearing loan from the government for the technical or clinical development of a new product, process or service. Funding may vary from 25% for large-scale companies to 35% for medium sized companies, and 45% for small companies, of relevant project costs. The maximum credit per company depends on the size of the company. For clinical development projects, there is a maximum of €5 million and for technical projects, it is €10 million.