Starter's deduction ends in 2027: use 2026 while you can
Written by Ilias Aarrass7 min read · Published on · Last reviewed on 
In short
In 2026 the starter's deduction is € 2,123 on top of the € 1,200 self-employed deduction; in April 2026 the government announced abolishing it from 1 January 2027, but that proposal has not been passed.
- You may use the starter's deduction at most three times in your first five years, and only if you meet the 1,225-hour criterion.
- The self-employed deduction keeps shrinking anyway: from € 2,470 in 2025 to € 1,200 in 2026 and € 900 in 2027.
- For a starter the deduction may exceed the profit, creating a loss you can offset against other years.
- No transition scheme has been announced, so if you qualify in 2026 it is better to use the deduction this year.
Anyone who started a business in recent years could count on a solid tax boost: the starter's deduction. In April 2026, the government announced plans to abolish this scheme as of 1 January 2027. This article explains what the starter's deduction is, what has been announced, and why 2026 may be the last year you can use it.
A quick refresher: what is the starter's deduction?
The starter's deduction is an extra deduction on top of the self-employed deduction. In 2026 it amounts to 2,123 euros that you can deduct from your profit, lowering your income tax. You qualify if you are entitled to the self-employed deduction (and therefore meet the 1,225-hour criterion), were not an entrepreneur in one or more of the five preceding years, and did not use the self-employed deduction more than twice in that period. You may use the starter's deduction at most three times in the first five years of your business.
For starters in particular, this benefit is significant. The regular self-employed deduction is only 1,200 euros in 2026; with the starter's deduction on top, you deduct a total of 3,323 euros from your profit. Starters also benefit from an exception: the deduction may exceed your profit, allowing you to offset the unused part later.
- You are entitled to the self-employed deduction and therefore meet the 1,225-hour criterion.
- You were not an entrepreneur for income tax purposes in one or more of the five preceding years.
- You did not apply the self-employed deduction more than twice in those five years.
- You use the starter's deduction at most three times in the first five years of your business.
What has been announced?
In April 2026, the government announced plans to abolish the starter's deduction as of 1 January 2027, without a transition scheme. In that case, the tax benefit ends after 2026. Note: this plan still needs approval from both houses of parliament as part of the 2027 Tax Plan, so it is not yet final. Meanwhile, the phase-out of the self-employed deduction continues: it drops from 1,200 euros in 2026 to 900 euros in 2027.
Put the amounts side by side and you see how fast it moves. Where a starter could still deduct nearly 4,600 euros from profit in 2025, only 900 euros may remain in 2027.
| Year | Self-employed deduction | Starter's deduction | Total |
|---|---|---|---|
| 2025 | € 2,470 | € 2,123 | € 4,593 |
| 2026 | € 1,200 | € 2,123 | € 3,323 |
| 2027 (proposed) | € 900 | abolished | € 900 |
What does that mean in euros?
A deduction lowers your profit, not your tax. What you keep from it therefore depends on your rate. There is also an intermediate step: on the profit remaining after the entrepreneur's deduction, the 12.7 per cent SME profit exemption comes off first. So of every euro of deduction you feel roughly 87 cents in your taxable profit.
Worked example: starter with € 60,000 profit
- Deduction in 2026: self-employed plus starter's
- € 3,323
- After the 12.7% SME profit exemption
- € 2,901 lower taxable profit
- Tax saving at 37.56%
- around € 1,090
- The same benefit in 2027 (proposed: € 900 deduction)
- around € 295
Result: A difference of nearly € 800 a year, at the same profit. Run your own situation at your actual rate
What does this mean for you in 2026?
Do you meet the conditions in 2026? Then this may be the last year in which you can use the starter's deduction. Make sure your time records are in order so you can substantiate the 1,225-hour criterion. Indirect hours count too: administration, travel time, preparing quotes, and training. What else the Tax Plan 2027 changes for freelancers is in Tax Plan 2027: what changes for freelancers and director-shareholders.
Unsure whether you meet the conditions this year, or considering starting as a freelancer soon? Then it may pay off to run the numbers on your situation now. Schemes linked to the starter's deduction, such as arbitrary depreciation for starters, may also be affected by the abolition; exactly how will become clear once the 2027 Tax Plan is final. How a Prinsjesdag proposal eventually becomes law is explained in Prinsjesdag: what it means for entrepreneurs.
Worth it even with little or no profit
Many starters think: my profit is low this year, so the deduction does nothing. For the starter's deduction that is not true. Unlike the regular self-employed deduction, for a starter the deduction may exceed the profit, creating a loss you may offset against other years. So claim it in a lean year too, provided you meet the hours criterion.
Frequently asked questions
How much is the starter's deduction in 2026?
2,123 euros, on top of the 1,200 euro self-employed deduction. Together you deduct 3,323 euros from your profit. In 2025 that was still 4,593 euros combined.
Is the 2027 abolition certain?
No. The government announced it in April 2026, but it still has to pass both houses of parliament as part of the 2027 Tax Plan. Do assume it in your planning, though, because no transition scheme has been announced.
I started in 2025. Can I still use the starter's deduction in 2026?
Yes, if you meet the conditions and have not used it three times already. The deduction may be used at most three times in the first five years of your business, and those years need not be consecutive.
Should I start quickly to catch the deduction?
Only if you were planning to start anyway and can still reach 1,225 hours this year. If you start in autumn you often will not make the hours criterion, while the year still counts as an entrepreneurial year. Do the maths before you register.
Do hours for admin and acquisition count towards the hours criterion?
Yes. All hours you spend on your business count: invoicing, bookkeeping, travel time, writing quotes, maintaining your website and training. Counting only billable hours is a common misconception.
What remains once the starter's deduction is gone?
The 900 euro self-employed deduction and the 12.7 per cent SME profit exemption. Ordinary business deductions and the investment deduction remain; those become relatively more important for starters.
Sources
- Self-employed and starter's deduction 2026Belastingdienst · belastingdienst.nl
- Self-employed deduction down to € 900 in 2027Overheid.nl · ondernemersplein.overheid.nl
Sources checked on
This article provides general information based on the rules known for 2026 and does not replace personal tax advice. For your specific situation, we're happy to take a look with you.
