What What is the WBSO?
The Research and Development Promotion Act, also known as the WBSO (Wet ter Bevordering Speur- en Ontwikkelingswerk), is a government tax deduction scheme to encourage technological innovation. With this scheme enterprises can reduce their tax load related to R&D wages and in some cases R&D-related costs or expenses. The scheme is intended for technically high-risk innovations.
Why does the WBSO exist?
With the Research and Development Promotion Act the Dutch government aims to stimulate enterprises in the Netherlands to invest in technically high-risk innovations. By definition the act of development is inherently risky. There will never be certainty that the product you aim to develop will work as intended. A systemic approach to technical research and innovative development is needed to overcome the hurdles towards the desired product.
You can, of course, apply for the WBSO yourself. Still having trouble? We are happy to help you get started so that you can submit the application yourself. Would you prefer to hand the process over? Then we will take care of the entire process for you. We value our relationship with the Netherlands Enterprise Agency (RVO) in this regard.
Which projects are eligible for the WBSO?
Projects qualify for the WBSO if your company carries out Research and Development (R&D): technical development with prior uncertainty, i.e. uncertainty whether or how it will work, in which a structured and iterative process is used to arrive at a desired solution.
Examples for eligible WBSO-projects
- Development of a new or technically improved product. E.g. a machine, device, sensor, embedded system, electronics, medical or chemical product.
- Development of a new or technically improved production process. E.g. automation/robotization, new processing steps, scaling up with technical bottlenecks, quality or yield improvement through new technology.
- Development of new or improved software provided its technical novelty). E.g. new algorithms, performance/scalability issues, complex integrations, cybersecurity-by-design, computer vision/AI engineering, real-time systems.
- Technisch-wetenschappelijk onderzoek is another category of R&D within the WBSO that allows you to obtain WBSO funding for research that is both technical and scientific in nature and can yield new technical knowledge. The research must relate to technical domains, such as physics, chemistry, biotechnology, and production technology. The research qualifies as Technical-scientific research if you are seeking an explanation for a phenomenon that you cannot provide based on generally available knowledge, and there is a real risk that you will not find that explanation.
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Frequently Asked Questions
No. The focus of the WBSO is the development process itself in relation to the technical bottlenecks and uncertainties. Even when product development lacks the desired outcome the R&D related work might still be relevant.
Yes, provided the development itself is technically novel, e.g. new algorithms, performance/scalability, complex integrations or real-time challenges.
The net WBSO benefit comprises of a wage and an expenses portion. First and foremost, the wage component of the R&D related work is determined. This comprises of the number of R&D hours allocated by the RVO multiplied by a single fixed R&D hourly wage for that calendar year. If available, this hourly wage is based on wage data from two years prior. Otherwise, a flat-rate hourly wage is applied.
Subsequently, a surcharge is added on top of the R&D wage component for other R&D related expenses. This surcharge comes it two flavours. One being a flat rate in which case RVO includes a fixed amount, i.e. € 10 for the first 1.800 hours and € 4 thereafter, per awarded R&D hour. The second option is to opt for actual costs and expenses, in which case the amount of costs/expenses awarded by RVO is included. These costs and expenses are attributed to specific items such as materials, prototypes or investments in new business assets that are directly attributable to and serviceable to R&D.
These two components, being the R&D wages and the surcharge, form the R&D basis. The WBSO benefit, R&D tax reduction, is then calculated on that basis: 36% on the first € 391,020 and 16% on the excess. The exemption being starters that receive 50% within the first bracket.
In addition to RVO, which implements and assesses the WBSO scheme, specialised subsidy consultancy firms such as Real1ze can guide entrepreneurs in drafting and submitting a WBSO application. Real1ze assists with formulating the technical plan, substantiating the R&D hours, and meeting RVO's assessment criteria.
A WBSO application requires a technically substantiated project plan that meets specific RVO criteria for research and development. Errors in the substantiation or time recording often lead to a lower grant award or rejection. Consultancy firms like Real1ze are familiar with RVO’s assessment practices and can formulate the application to align with the requirements the RVO stipulates.
