innovatiebox

Innovatiebox is a Dutch tax incentive within the corporate income tax system designed to encourage research and development by taxing a portion of profits derived from qualifying intellectual property at a reduced rate. The regime applies a preferential rate of 9% to profits attributable to qualifying IP, while profits not linked to IP are taxed at the normal corporate income tax rate.

Qualifying IP includes self-developed intangible assets protected by IP rights, such as patents, software, or know-how, and profits derived from exploiting these assets. The asset must result from substantial R&D and be owned or economically controlled by the claimant. The regime applies only to profits attributable to the IP, not to general business profits.

Calculation and administration: Taxpayers determine the portion of profits attributable to the IP; those profits are taxed at 9%, with the remainder taxed at the ordinary rate. The Netherlands Tax and Customs Administration requires documentation linking the IP to the profit, including development costs, ownership, and licensing arrangements.

Administration and limitations: Claims are made in the corporate income tax return with supporting schedules. The regime has rules regarding ownership, transfer of IP, and clawbacks if the IP ceases to meet conditions. It is subject to updates reflecting EU and BEPS guidance.

Impact and history: The Innovatiebox is a key element of the Netherlands' innovation policy and is widely used by technology, life sciences, and software companies to increase the commercial return on R&D investments.