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Disability insurance (AOV) for self-employed persons

As a self-employed person or entrepreneur, you take out disability insurance (AOV) in case you are unable to work due to an accident or illness. You will then receive a payment for the income you miss.

What is disability insurance?

Disability insurance is an insurance policy that you take out to have income during illness, or if you become disabled or have an accident. Usually such insurance is taken out by people who are not in paid employment, such as entrepreneurs or self-employed persons. Disability insurance is also often taken out when taking out a mortgage loan for an owner-occupied home.

Have you paid premiums for disability insurance?

You may deduct these premiums if you:

you have taken out private disability insurance, and receive any benefits periodically Disability insurance with your mortgage when you take out a mortgage, you are usually asked if you want to take out housing costs insurance.

This insurance includes a premium for disability. Do you receive a periodic benefit from this insurance if you become disabled? Then you may also deduct the premium you pay for this in your income tax return.

Which premiums may you not deduct?

You may not deduct premiums for the following periodic payments:

premiums for disability insurance that pay out the entire amount in one go premiums in which you will receive the amount periodically, but the total amount of that amount is pre-determined premiums that your employer takes into account when deducting wage tax and national insurance contributions Sickness Benefits Act and WIA premiums for the Org-insurance Act.

Do you receive a benefit from a private disability insurance?

Then your insurance company already deducts wage tax on this.

The deduction applies to periodic benefits that you receive because you are (partially) incapacitated for work. You receive these benefits from an insurance policy that you have taken out with a life insurer or an income insurer. For example:

You have taken out disability insurance as an entrepreneur.

You have taken out disability insurance when buying your own home.

You state this income in your tax return as income from previous employment

Pay attention!

Are you receiving a benefit from a private disability insurance because of pregnancy?

Then you do not have to pay tax on this benefit. You therefore do not have to state this benefit in your tax return.