Arbitrary depreciation for starters explained
Written by Ilias Aarrass7 min read · Published on · Last reviewed on 
In short
Starters entitled to the starter deduction may choose when to depreciate, up to the small-scale investment deduction ceiling of € 398,236 of investment per calendar year.
- The scheme applies to a sole trader, partnership, limited partnership or general partnership, not to a BV.
- Investments from the run-up year, the year before you start, also qualify.
- Assets that give no right to investment deduction, such as ordinary passenger cars, are excluded.
- The total stays the same: you pull deduction forward and have less left in later years.
Besides the well-known starter's deduction there's a lesser-known benefit for starting entrepreneurs: arbitrary depreciation. With this you may decide yourself when to depreciate your investments. That can help you steer your tax. This article explains how it works.
What is arbitrary depreciation?
Normally you depreciate a business asset in fixed steps over several years. With arbitrary depreciation you may decide yourself how much you depreciate in which year, as long as you stay within the total depreciation. You may, for example, depreciate faster in a profitable year to lower your profit.
Who is it for?
Arbitrary depreciation for starters applies to entrepreneurs entitled to the starter's deduction. It concerns investments in business assets that also qualify for the investment deduction. Conditions and a maximum amount apply, so check whether your situation falls under it.
What's the benefit?
The big advantage is flexibility. If you make a lot of profit in a certain year, you can depreciate faster to pay less tax that year. If you make little profit, you depreciate less and save the deduction for later. This way you steer your taxable profit across the years.
What should you watch out for?
Arbitrary depreciation is handy, but requires thinking ahead. Faster depreciation means you have less to deduct in later years. So it's not an extra deduction, but a shift in time. Get advice on this so you use the timing optimally.
When this is smart, with a worked example
Arbitrary depreciation is valuable mainly because it lets you shift between years with different rates. In a high-profit year the deduction lands in the top bracket; in a lean year it would fall at a low rate or even go unused.
- The condition is entitlement to the starter's deduction in the investment year, so meeting the hours criterion too. Investments from the run-up year, the year before you start, count as well.
- It applies to investments up to the annual ceiling of the small-scale investment deduction, so € 398,236 in 2026; assets that give no right to investment deduction, such as ordinary passenger cars and land, fall outside it.
- You may also depreciate partly arbitrarily and the rest on a straight line.
- Combine with the small-scale investment deduction: it is separate from your depreciation choice.
Worked example: a € 20,000 van bought in a peak year
- Normal depreciation per year (5 years, € 5,000 residual)
- € 3,000
- Arbitrary: everything in year 1, at 49.5%
- € 15,000 deducted at once
- Gain versus spreading at 37%
- around € 1,875
Result: Note: you are pulling tax forward; the real saving is the rate difference, and the 12.7 per cent SME profit exemption trims that gain further. In later years there is nothing left to depreciate
Frequently asked questions
Who may use arbitrary depreciation?
Starters entitled to the starter's deduction in the investment year, so with the self-employed deduction and within the first five years. It covers assets up to the annual maximum.
What is the advantage over normal depreciation?
Timing. With normal depreciation the annual amount is fixed; here you choose which year the deduction lands in, say a peak year at the top rate. The total stays the same; the gain sits in the rate difference and the earlier refund.
Can I create a loss with it?
Yes, and deliberately so: the loss is offset against other years. Do watch your credits and benefits in the year itself; zero profit is not always optimal.
Does it apply to a car?
Not for standard passenger cars. Vans and other business assets do qualify, provided they are intended for your business.
Must I depreciate everything at once?
No, arbitrary literally means free: everything at once, nothing, or part. Whatever you have not depreciated remains for later years.
Does it combine with the investment deduction?
Yes, the small-scale investment deduction is separate and comes on top. Together they can substantially reduce taxable profit in the purchase year.
Sources
- Arbitrary depreciation for starting entrepreneursBelastingdienst · belastingdienst.nl
- Small-scale investment deduction 2026Belastingdienst · belastingdienst.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.
