SMEs get new tax deduction for digital investments

Small businesses now have a tax deduction worth 13.5% of the cost of investments in digital technology, the government has decided. The measure should encourage the companies to invest more in, for example, a web shop or enhanced computer security.

The deduction already exists for concrete investments, such as offices or production machinery. That has now been extended to include digital investments. At present, Belgian companies make 2.4% of their income from online sales; the average for Europe is 6%.

Many small companies, in particular those run by older bosses, either fail to see the interest in switching to digital or are unable to devote the time to learning. The new measure provides an incentive to make the move, covering investments such as software, website development, e-commerce, payment terminals and cyber-security.

It is also retroactive to last January, allowing deductions for any digital investment made since the start of the year. According to one tax expert quoted in Trends magazine, the investment deduction alone will not be enough to close Belgium’s digital deficit. “But we’re on the right track,” said Gregory Henin of SBB Accountants.

Photo: Ingimage