In principle, all expenses incurred to enable business operations are deductible. This means that travel and accommodation costs, as well as VAT, are to some extent deductible or reclaimable.
In addition to travel and accommodation expenses, business environments often involve so-called representation costs in the form of a lunch, dinner, conference, etc. These representation costs are also referred to as mixed expenses, meaning they have both a business and a private character (e.g., satisfying hunger). These costs can only be partially deducted from income or corporate tax. Because in practice full certainty about the business nature of travel and accommodation expenses can never be provided, the Dutch Tax Administration has established a number of rules and limitations to safeguard the business nature of these costs.
Deducting expenses for income and/or corporate tax
Expenses related to domestic and international representation, conferences, seminars, study trips—including travel and accommodation—can be deducted to varying degrees for income or corporate tax purposes. Deductible expenses reduce the company’s profit. A lower profit means that you subsequently pay less income or corporate tax. The extent to which expenses are deductible depends on the legal form of your company in combination with the size, type, and nature of the expenses.
Partially deductible expenses
The following (mixed) expenses may be partially deducted in your income tax or corporate tax return:
- Food (for example, a business dinner including tip, hotel breakfast)
- Drinks, indulgences (for example, a reception including alcohol)
- Representation at receptions, parties, etc. (admission costs)
- Representation at conferences, excursions, study trips, etc. (admission costs, hotel accommodation)
Deductibility depends on the reason for the hotel stay
When you stay in a hotel for a conference, seminar, or study trip, the hotel expenses are only partially deductible. For a stay for another business reason (e.g., a business assignment), the hotel expenses are fully deductible.
Van een reguliere zakelijke hotelovernachting zijn de verblijfskosten (overnachting) volledig aftrekbaar maar horecakosten zoals ontbijt en diner in gedeeltelijke mate.
Limited deductibility per legal form
Below is an explanation per legal form of which portion of the mixed expenses is only partially deductible:
- Income tax (sole proprietorships, partnerships, and general partnerships)
80% of the expenses are deductible, 20% is non-deductible and therefore at your own expense. - Corporate tax (private limited companies and public limited companies)
73.5% of the expenses are deductible, 26.5% is non-deductible and therefore at your own expense.
Fully deductible expenses
When you travel for business by train, plane, bus, tram, or (Uber) taxi, these costs are fully deductible from your income or corporate tax.
Mileage allowance (rental car)
When you travel with your own or a rental car, €0.23 per business kilometer driven may be deducted from revenue in your income tax or corporate tax return. This applies regardless of whether the trip takes place in the Netherlands or abroad. The rental cost of a hired car is fully deductible, provided the car is used for business purposes and an invoice with VAT is available.
Non-deductible expenses
Examples of non-deductible expenses include traffic fines incurred in the Netherlands or abroad, personal care, and vessels used for representation purposes, such as a boat on which a lunch is organized.
Minimum-maximum amounts
For the deduction of expenses, a threshold (minimum amount) applies, which the expenses must exceed. For the 2025 tax year, the threshold is €5,700 for total expenses. This means that only expenses exceeding this amount may be deducted. For travel and accommodation expenses, unlike other expenses, a maximum amount applies. These may be deducted up to a maximum of €1,500.
Example
Suppose you incur the following expenses in 2025:
- €2,500 for food, drinks, and indulgences
- €3,250 for a reception
- €2,750 for travel and accommodation expenses for attending conferences, seminars, etc.
De totale kosten zijn € 8.500. Van de reis- en verblijfskosten mag u maximaal € 1.500 aftrekken. Dit brengt de kosten op € 7.000 (€ 8.500 – € 1.500). Verminderd met de drempel (€ 5.700) komt u uit op een bedrag van € 1.300. Dit bedrag mag u als kosten aftrekken.
In the case of corporate tax (CIT), if 0.4% of the total payroll exceeds the €5,700 threshold, this higher amount must be used as the threshold. For companies with a payroll of more than €1,425,000, the fixed amount is therefore higher than €5,700 (€1,425,000 × 0.4% = €5,700).
Alternative: deduction of expenses without a threshold
Instead of applying a fixed (€5,700) threshold for expense deduction, you may choose to deduct a fixed percentage of the expenses. For income tax, this is 80%; for corporate tax, 73.5%. In this case, you do not need to exceed the threshold. However, the deduction limit of €1,500 for travel and accommodation expenses still applies.
Example calculation for income tax
Suppose you incur the following expenses in 2025:
- €1,250 for a reception
- €1,750 for travel and accommodation expenses for attending conferences, seminars, etc.
The total expenses amount to €3,000. Of the travel and accommodation expenses, you may deduct a maximum of 80% of €1,500. €1,750 – €1,500 = €250. This reduces the deductible expenses to €2,750 (€3,000 – €250). The amount you may deduct as expenses is 80% of €2,750 = €2,200. This amount may be deducted from income tax.
Depending on the amount of mixed expenses you incur, choosing either a fixed threshold amount or a fixed percentage may be more advantageous for your company. If, during the year, you incur more than €28,500 in expenses, opting for a fixed amount may be more beneficial. For income tax, you may deduct 80% and 20% is non-deductible, meaning the non-deductible portion exceeds the fixed threshold of €5,700. In that case, you choose the lowest possible amount of non-deductible mixed expenses and can deduct relatively more.
Gebruiksvriendelijker (websitevriendelijk):
Demonstrating the business nature of expenses
If you wish to (partially) deduct expenses from income or corporate tax, there are a number of factors you must take into account:
- For all expenses, you must be able to demonstrate their business nature. The Tax Administration may verify this. Therefore, keep all invoices and receipts from your business trip carefully. For business dinners, note the names of your guests on the receipt.
- Are you combining a vacation with your business trip? In that case, you cannot deduct all expenses if they do not have a business purpose. Make sure to clearly distinguish the expenses with separate invoices/receipts or a detailed breakdown.
- Your company name must be stated on the invoice or receipt. If it is not already mentioned, you should add it yourself.
- For a business overnight stay, request a split invoice separating the accommodation from food and drinks. This is due to the difference between fully and partially deductible expenses
Reclaiming VAT for turnover tax
In addition to deducting expenses for income or corporate tax, you may also reclaim VAT on business travel and accommodation, as well as food and drink, as input tax in your VAT return, to a certain extent.
To reclaim VAT in your VAT return, you must take the following into account:
- VAT on food and drinks provided by a caterer in a private/closed-off space is reclaimable.
- VAT on food and drinks provided by a caterer in a closed-off/private space is reclaimable.
- VAT on food and drinks delivered by, or picked up from, a caterer or restaurant is reclaimable.
- VAT on food and drinks purchased at a supermarket is reclaimable.
- VAT on hotel accommodation expenses is reclaimable
- Foreign VAT cannot be deducted through the regular VAT return but can be reclaimed from the EU country via the Dutch Tax Administration.
Requirements
Good administration is the foundation of your VAT return. There are tax rules for managing and retaining your records. The following requirements also apply when reclaiming VAT:
- VAT has actually been paid on the service.
- The invoice is issued in the name of your company.
- Facturen dienen aan de eisen van de Belastingdienst te voldoen, dit omvat o.a. de naam en adres van uw bedrijf, uw BTW-nummer etc.
Voor alle eisen ten aanzien van uw administratie en de BTW-facturen verwijzen we u graag naar de website van de Belastingdienst.
Summary
As you have read, you can gain significant benefits by including the expenses and VAT from your business travel, accommodation, and other representation costs in your income or corporate tax returns and VAT returns. For regular business hotel stays, there are no restrictions on deductibility. These are therefore fully deductible—provided they are not booked for a conference, seminar, or study trip.
Other travel- and accommodation-related expenses can also often be largely included in your tax returns. By allocating your expenses wisely, you can achieve the greatest benefit. However, it is important to keep in mind which tax rules and limitations apply, and when and where they apply