The innovation box is a special Dutch corporate tax regime that reduces the effective Vpb rate to just 9% on profit derived from qualifying innovations. This is one of the most powerful tax incentives for technology companies.
Short answer
The innovation box is a Dutch tax discount for companies that make money from their own inventions or software: qualifying profit is taxed at 9% instead of the normal rates. The entry ticket is a WBSO statement (the Dutch R&D wage subsidy — applying for it also proves your work counts as innovation). For software companies the route is well-trodden: WBSO first, then agree the innovation-box split with the tax authority. Combined with the 19% entry rate and the holding structure, this is why tech founders pick the Netherlands.
What is the innovation box?
The innovation box (innovatiebox) is a reduced corporate tax rate of 9% on profit from qualifying innovative work — against the standard 19%. Qualifying activities include software development under the WBSO, patented inventions and other self-developed intangible assets.
WBSO: the gateway
For most SMEs the gateway is the WBSO, the Dutch R&D tax credit. A valid WBSO declaration from RVO confirms that the work counts as research and development. Income from assets developed under that declaration qualifies for the innovation box.
How much it saves
On €100,000 of qualifying innovation profit: 9% against 19% is a €10,000 saving per year. At €300,000 of innovation profit, the saving grows to €30,000 and more.
Practical requirements
- An active WBSO declaration for the development work.
- A clear split of costs between innovation work and the rest of the business.
- IP developed in-house, in the Netherlands.
- The innovation box election specified in the annual corporate tax return.
Every Dutch rate the innovation box sits next to — corporate tax, VAT, box 2 — is on Netherlands tax rates 2026.
The neighbouring questions
In the same direction: Corporate Tax Rate 2026 and Calculate Corporate Tax 2026.
Frequently Asked Questions
Can a service company use the innovation box? +
Qualification runs through development work: a company that develops its own software or processes under a WBSO declaration can qualify, also when it sells services. Pure service delivery, with the development left out, stays outside the box.
Is the WBSO the same as the innovation box? +
They are two separate instruments that stack. The WBSO reduces payroll tax on R&D salaries — a direct cash benefit. The innovation box lowers the corporate tax rate on the resulting profit. One project can use both at the same time.
