Tax plan entrepreneurs 2024: Imminent changes
The government is resigning, therefore there are no major surprises for entrepreneurs in the Tax Plan for 2024 presented on Budget Day. Nevertheless, there are plenty of proposed changes that could have an impact on your tax-economic position. Now that the House of Representatives has approved the Tax Plans for the coming year at the end of October, we can update you on the Tax Plans and proposed changes for the coming year.
Please note: the Tax Plan is not yet final. The Senate has yet to decide on this. It is customary for proposed plans for legislative changes to be made concrete in the new year. Moneywood will keep you informed about this.
SME profit exemption reduction
The SME profit exemption will be reduced from 14% to 13.31%. As a result, entrepreneurs pay tax on a larger part of their profit or income. The government's proposal was to implement a reduction to 12.7%. Just before the election recess, the House of Representatives decided that they would not agree to this. The percentage has therefore been adjusted to 13.31%. Entrepreneurs with the highest profits will lose out the most as a result of this adjustment.
Reduction of self-employed deduction
A measure from the previous Tax Plan is the further reduction of the self-employed deduction from € 5,030 to € 3,750. As a result of these changes to IB (income tax) entrepreneurs will also pay more tax.
Business transfer arrangements
The government wants to continue the BOR (businees transfer regulations) and the transfer scheme in an adapted form. The transfer of a company should become easier and remain possible.
Reinvestment reserve adjustments
The government wants to give entrepreneurs the opportunity to use the reinvestment reserve (in Dutch: herinvesteringsaftrek) in more situations. With a reinvestment reserve, entrepreneurs can defer tax under certain conditions when they sell an asset at a profit (book profit).
Transfer tax on new real estate through share transactions (from 2025)
The government wants to levy 4% transfer tax on the transfer of new real estate through share transactions. Entrepreneurs then pay about the same amount of tax as with the direct delivery of new real estate. Entrepreneurs can register real estate projects that have already started for a transitional arrangement.
Exempting public transport cards (OV-passes) from payroll tax
From 1 January 2024, the government wants to make it easier for employers to reimburse or provide an employee with a (partly) business public transport card exempt from payroll tax.
Adjustments on fees for WOZ objections (valuation of property) and bpm (vehicle registration tax)
As a company, do you object to WOZ and BPM decisions? The government wants to reduce the compensation for legal costs and immaterial damage in the event of these objections in order to make it financially less attractive for objection agencies to start proceedings. Although initially not included in the Budget Memorandum, the House of Representatives established in October that this rule will also be applied to other regular appeals against administrative sanctions.
Labour tax credit increases for the employed
Do you or your employee's fall just above the threshold for an employment discount? This may change: for people in work, the employment tax credit will increase by €115 for an income around the statutory minimum wage.
Lower indexation bracket 2
In 2024, the 2nd income tax bracket will be indexed by 3.55% instead of 9.9%. As a result, people with a high income benefit less.
Slight increase in bracket 1 rate
The rate in the 1st tax bracket increases by 0.03 percentage points. As a result, entrepreneurs will pay a maximum of € 20 more tax.
Preparing for 2024
As mentioned, the Senate still has to agree to the plans before they become final. But you may want to align your policies and forecasts with the intended changes. Moneywood is happy to help you with that.
Do you want to read more about Budget Day and the proposed tax plans? On this webpage you can find official information from the Dutch Government in English.