Small-Scale Investment Deduction (KIA)
The small-scale investment deduction (KIA) is an extra tax deduction for entrepreneurs who invest in business assets. Think of machinery, computers, business vehicles, or office equipment. The KIA is a percentage of the investment amount that you can deduct from your profit. The KIA applies when you invest more than €2,801 in a year. The percentage varies: for investments up to €67,404 you get 28% deduction, above that the percentage decreases. Above €387,580 in investments, the KIA disappears entirely. Each business asset must cost at least €450 to count.
Example
You buy a new laptop (€1,500), a desk (€800), and a printer (€500) for your business. Total: €2,800 – just under the KIA threshold. But if you also buy an office chair for €200, you reach €3,000 and can deduct an extra 28% = €840 from your profit. That saves you €311 in tax.
Why does this matter?
Planning to invest in your business? Keep the KIA in mind. Sometimes it's smart to bundle investments in one year to exceed the threshold, or to spread them if you'd otherwise go over the limit. Discuss the best timing with your tax advisor.