Are you developing products, production processes or software? Do you face technical challenges or risks during the development stage and do you resolve these with your own people? Are you presently performing your own research and development activities? And, finally, do you pay payroll tax or other taxes in the Netherlands?

If you can answer all of these questions with a definite “yes”, then it is high time you consider your options for tax credit, as you are eligible for benefits under the Dutch Promotion of Research and Development Act (Wet bevordering speur- en ontwikkelingswerk, “WBSO”). Availing yourself of the WBSO is important for gaining access the innovation box and innovating truly successfully making the most of tax benefits.

WBSO: saving on (wage) costs and expenses

The WBSO offers a tax credit that you may be entitled to (at any time) during the research and development phase. Thanks to this scheme, you can obtain a payroll tax credit in respect of (wage) costs and expenses pertaining to the “research and development” relating to your products, production processes or software. This credit can be as high as 40%. This allows you to make substantial savings on your payroll tax payments. Please note, however, that completed projects are no longer eligible for the WBSO.

WBSO subsidy: technical input from your own organisation

An absolute precondition for being allowed to benefit from the WBSO scheme is that the staff doing the research and development are on your business’s payroll. If you have you decided to contract out a major automation project in its entirety, your right to a subsidy will lapse - something to consider when, prior to the start of any such project, you have not decided whether to engage an external agency or hire new staff.

Labour and capital

The WBSO was introduced for Dutch organisation carrying out development projects. Two things are important when applying for the WBSO: labour and capital. Labour in the form of the employees who perform the research and development activities. Capital concerns the costs/expenses that must be incurred, in addition to wage costs, to turn the research and development into a success. If the R&D results in profits, this clears the way for an innovation box procedure.

Physical products and software

You are eligible for the WBSO scheme if you develop technically new software (or parts of such software), physical products or production processes, and for scientific technical research. The development activities must: 1) be technically new for the applicant; 2) be handled on a project basis; and 3) take place in one of the EU countries. Activities such as market research, economic feasibility studies and organisational/accounting activities are excluded from this tax scheme.

Strengthening innovative drive

If you eligible for the WBSO, but do not have time to file an application and arrange for its handling, we would be happy to take care of the entire application procedure for you minimise the administrative risks and burden, so that you can continue to focus on the development activities. In addition, we can assist you with organising and implementing WBSO projects. Our specialists have long-standing experience with successfully handling WBSO applications and the associated administrative obligations - not only with a view to short-term savings, but definitely also with strengthening your innovative drive.

Successful application

However big your chances of tax cuts may be, the right timing is crucial for a successful application. Notify your consultant, auditor or tax lawyer of your plans as quickly as possible, preferably during the planning phase. In other words, involve your consultant in your R&D projects on time, as timeliness is a decisive factor in letting innovation play a significant role in achieving your tax goals.

More information

Please do not hesitate to contact one of our specialists for a personal consultation without any obligation if you are interested in finding out whether you are eligible for the WBSO.