A thoughtful business gift (‘relatiegeschenk’) can benefit your professional relationships. It strengthens bonds, shows appreciation, and ensures you stay top of mind with clients and business partners. But while you’re picking out that nice present, you’re probably wondering: to what extent are these costs tax deductible in 2025?
The Dutch tax rules surrounding business gifts can be quite tricky. This article provides a clear overview of the rules and threshold amounts. However, professional guidance, such as that from Kees de Boekhouder, is recommended for correct compliance and proper processing in your administration.
What are business gifts (‘relatiegeschenken’)?
First, let’s clarify what we mean by a business gift. ‘Relatiegeschenken’ are incidental gifts to existing business relationships, such as clients or suppliers, for which there is no direct reciprocal performance. The goal is to maintain or improve the business relationship.
It’s important to distinguish between:
- Business gifts (‘Relatiegeschenken’): Think of a bottle of wine for a loyal client, a Christmas hamper for your business partner, or tickets to an event for a potential client.
- Promotional items (‘Promotionele artikelen’): These are items you distribute en masse, often with your company logo on them, purely for promotional purposes. Think of pens, lanyards, or T-shirts you hand out at a trade fair. From a tax perspective, these fall under different rules than business gifts and are usually fully deductible.
Correct classification is crucial for tax processing. In doubt? The bookkeepers at Kees de Boekhouder are happy to help you.
Tax deductibility of business gifts (‘relatiegeschenken’) in 2025
Business gifts fall under what are known as ‘gemengde kosten’ (mixed costs). These are expenses that have both a business and private character. Therefore, they are only partially deductible from your profit.
For Income Tax (‘Inkomstenbelasting’), as an entrepreneur, you can choose between two methods for mixed costs:
- Threshold amount of €5,700 (2025): The first €5,700 of such costs (including business gifts, but also, for example, business dinners) are not deductible. Amounts above this are fully deductible.
- Fixed deduction percentage of 80%: You may deduct 80% of the incurred costs, without encountering a threshold amount. For most freelancers (‘zzp’ers’) and small businesses in the Netherlands, this is the most common and often most advantageous option, as they usually do not reach the €5,700 threshold.
For Corporate Income Tax (‘Vennootschapsbelasting’) (if you have a ‘BV’ – private limited company), a fixed deduction percentage of 73.5% applies.
VAT deduction on business gifts
And what about the VAT on business gifts? Good news: the VAT is deductible, but there’s an important condition: the VAT on business gifts is deductible if the annual expenses per recipient do not exceed €227 exclusive of VAT.
What happens if you exceed this amount? If the total expenses for gifts per recipient per year are more than €227 exclusive of VAT, then the VAT on those gifts is not deductible, unless the recipient could deduct at least 30% of the VAT if they had purchased the gift themselves. The latter is a complex exception that rarely occurs in practice for business gifts to private individuals.
Administrative processing and points of attention for business gifts
Good administration is essential for the deductibility of business gifts. Here are the most important points of attention:
- Administration per recipient: We advise keeping track of business gifts per recipient. Note the date, type of gift, costs (excl. VAT), and the VAT paid.
- Keep invoices and receipts: This may seem obvious, but it’s crucial! Invoices and receipts are essential as proof for the Belastingdienst. Without proof, no deduction.
- Correct booking: Book business gifts under the correct category, namely ‘verkoopkosten’ (sales costs), with the description ‘relatiegeschenk’. Incorrect booking can lead to loss of deduction or even a reassessment during an audit.
In short
Business gifts are a valuable investment in your business relationships. They are certainly deductible, but with limitations and under specific conditions. By correctly applying the rules for cost and VAT deduction, you can get the maximum benefit from these expenses.
Do you want to be sure that your business gifts are correctly processed in your administration and that you make optimal use of all tax advantages? With a personal bookkeeper at Kees de Boekhouder, you can be confident in your affairs.
FAQ
Are business gifts fully deductible?
No, business gifts (‘relatiegeschenken’) are only partially deductible in the Netherlands. For Income Tax, you can choose between a threshold amount of €5,700 or a fixed deduction percentage of 80% of the costs.
When is the VAT on business gifts deductible?
The VAT on business gifts is deductible if the annual expenses per recipient do not exceed €227 exclusive of VAT.
What is the difference between a business gift ('relatiegeschenk') and promotional material?
A business gift is an incidental gift to maintain an existing relationship. Promotional material is distributed en masse for advertising, often with a company logo, and falls under different tax rules.
Do I need to keep receipts for business gifts?
Yes, keeping invoices and receipts is essential as proof for the Belastingdienst for the deductibility of business gifts.
How do I correctly process business gifts in my administration?
You book business gifts under ‘verkoopkosten’ (sales costs). Make sure to keep track of the costs and VAT per recipient.
