MKB profit exemption: an automatic 12.7% tax break

The MKB-winstvrijstelling (SME profit exemption) is one of the sweetest tax breaks in the Netherlands: the government automatically exempts 12.7% of your profit from income tax, simply because you're running a small-to-medium business. No application, no paperwork, no conditions — you just get it.

What is it?#

The MKB-winstvrijstelling is an automatic deduction of 12.7% of your remaining profit (after the zelfstandigenaftrek and startersaftrek) from your taxable income.

It's applied by the tax office without you doing anything. When you file your annual return, it calculates itself.

In 2025 and 2026, the rate is 12.7%. In 2024 it was 13.31%, so it's also being slowly reduced (though much more gently than the zelfstandigenaftrek).

How much does it save you?#

At a typical 37% marginal tax rate, a 12.7% exemption on €50,000 profit saves you roughly €2,350 per year.

On €100,000 profit, it saves roughly €4,700 per year.

That's real, tax-free money.

Who gets it?#

You automatically qualify for the MKB-winstvrijstelling if you:

1. Are self-employed in the Netherlands (eenmanszaak, vof, or a bv).
2. Have positive profit from your business.
3. Pay income tax in Box 1 (entrepreneurship).

There are no hours requirements, no paperwork, no conditions. Everyone running a business gets it.

The only exception is if you're not classified as self-employed (e.g., you're genuinely salaried, not freelance), but that's rare.

How it works: the order of deductions#

The MKB-winstvrijstelling is applied last, after the zelfstandigenaftrek and startersaftrek.

Order:

1. Calculate profit (revenue − business costs)
2. Subtract zelfstandigenaftrek (€1,200 in 2026)
3. Subtract startersaftrek (€2,123 if you qualify, for max 3 years)
4. Calculate 12.7% of the remaining amount — this is the MKB exemption
5. The rest is taxable

Worked example (2026):

• Your revenue: €120,000
• Business costs: €40,000
• Profit: €80,000
• Minus zelfstandigenaftrek: −€1,200
• = €78,800
• Minus startersaftrek: −€2,123 (if you're a new starter)
• = €76,677
• MKB exemption (12.7%): −€9,737
• Taxable profit: €66,940

Without the MKB exemption, you'd pay income tax on €76,677. With it, you pay on only €66,940. At 37% tax, that saves you €3,603 in tax.

Does the MKB exemption replace business costs or the zelfstandigenaftrek?#

No. It's completely separate and stacks on top.

• Business costs are deducted first (from revenue)
• Then the zelfstandigenaftrek (if you qualify)
• Then the startersaftrek (if you're a new starter)
• Then the MKB exemption (12.7% of the remainder)

You lose nothing by claiming the MKB exemption — it doesn't replace any other deduction.

See the full picture: How your deductions stack: a worked example.

What counts as profit for the MKB exemption?#

Profit is your revenue minus all deductible business costs. That includes:

• Employee salaries (if you have staff)
• Materials and supplies
• Equipment and depreciation
• Office rent, utilities
• Software, phone, internet
• Professional services
• Travel and mileage
• Marketing and client acquisition

The MKB exemption applies to what's left after all these costs are deducted.

If you made a loss (costs exceeded revenue), you get no MKB exemption that year.

The exemption is being reduced#

The MKB-winstvrijstelling was 13.31% in 2024, dropped to 12.7% in 2025–2026, and may shrink further. The government is gradually lowering it to reduce tax revenue loss.

Always check belastingdienst.nl for the current year's rate before filing.

What if you have multiple income sources?#

If you have both salary (Box 1 employment) and self-employment profit (Box 1 entrepreneurship), the MKB exemption applies only to the entrepreneurship profit. Your salary is taxed normally.

If you have other income (rental property, investments, etc. — different boxes), those are taxed separately.

MKB exemption and the oudedagsreserve#

The MKB exemption doesn't affect the oudedagsreserve (old-age reserve). You can claim up to 12% of your profit (before the MKB exemption) as a tax-free reserve for retirement. The two work independently.

If you reserve €6,000 (12% of €50,000 profit), you reduce your profit to €44,000, and then the MKB exemption applies to €44,000.

How the Belastingdienst applies it#

You don't claim the MKB exemption. You file your annual income tax return (aangifte), providing:

• Revenue and business costs (to calculate profit)
• Any additional deductions (zelfstandigenaftrek if you meet the urencriterium, startersaftrek if you're eligible)
• The tax office's software automatically calculates the MKB exemption and applies it

It's built into the system.

What you should do#

1. Understand it's automatic. You don't have to do anything to claim it. Just file your return and it's applied.
2. Don't worry about it replacing other deductions. It stacks on top of business costs, zelfstandigenaftrek, and startersaftrek.
3. Optimize your profit calculation. Make sure your business costs are fully deducted and documented. The lower your profit (after legitimate costs), the lower the exemption, so the benefits mainly come from the deductions, not the exemption itself. But every legitimate cost you deduct also reduces your tax bracket, so the savings are still real.
4. Verify the current rate yearly. The percentage can change.

See the complete deduction guide: Every tax deduction for freelancers: the complete checklist.

Frequently asked questions#

The MKB-winstvrijstelling is one of the most generous tax breaks available to Dutch business owners — and it requires absolutely nothing from you except to file your annual return. Combined with the zelfstandigenaftrek and business-cost deductions, it's a major reason why self-employment in the Netherlands can be financially rewarding. ZZP Belasting calculates all of these automatically so you capture every euro you're entitled to.

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