The Dutch government provides a range of subsidies to support innovative companies, making the Netherlands an appealing location for foreign businesses to establish a local entity. A ‘B.V.’ (Besloten Vennootschap) is the Dutch equivalent of a Ltd, LLC, or GmbH. Among the most well-known government incentives are the Innovation Box and the S & O subsidy, both designed to encourage and reward innovation and development.
Innovation box and S&O subsidy
S & O stands for Search and Development work (in Dutch: Speur- en Ontwikkelingswerk). Most information about this subsidy is available only in Dutch, so we’ve provided a brief explanation below to help you understand its purpose.
The Dutch government has set strict criteria that companies must meet to qualify for the S & O subsidy. This program can significantly reduce costs by lowering salary taxes for eligible businesses.
Once you’ve successfully obtained the S & O subsidy, your company may also qualify for the Innovation Box, another valuable incentive. Under this scheme, profits from innovative activities are taxed at just 7%, compared to the standard 20–25% corporate tax rate.
If you’d like to explore whether your company can benefit from these fiscal advantages, we’d be happy to connect you with one of our legal partners for further guidance.