Article 2:388 DCC: what acquisition cost and production cost comprise
Article 2:388 DCC defines the cost at which you value assets: for a purchase the purchase price with incidental costs, for own production the direct costs, possibly supplemented with indirect costs and construction interest.
The short answer
Article 2:388 DCC provides that the acquisition cost consists of the purchase price plus incidental costs, and the production cost of the raw materials and consumables used plus the directly attributable costs. A reasonable part of the indirect costs and the interest over the construction period may be added; if you capitalise interest, the notes state that.
Updated 30 October 2026
Key facts
| Place in the law | Section 6 of Title 9 |
| Mandatory | Purchase price and incidental costs (paragraph 1); raw materials, consumables and direct costs (paragraph 2) |
| Option | A reasonable part of indirect costs and interest on debts over the production period (paragraph 2) |
| Notes | State that interest has been capitalised; not for micro (art. 2:395a(6) DCC) |
| Elaboration | RJ 212 and RJ 220 (cost), RJ 273 (interest), RJ 221 (projects); RJk A2, B4 and B16 |
Paragraph 1: the acquisition cost
1. The acquisition cost at which an asset is valued comprises the purchase price and the incidental costs.
What this means. What you pay to obtain the asset and make it ready for use belongs to the acquisition cost: the purchase price after discounts, plus transport, installation, import duties, notary costs and, for a property, transfer tax. Deductible VAT does not belong to it; non-deductible VAT does (RJ 220.303 names recoverable taxes as an exception). Costs that were not needed to acquire the asset, such as staff training or the move after the start of use, are ordinary costs. A trade discount or bonus that you are likely to receive is already deducted for inventory.
Paragraph 2: the production cost
2. The production cost at which an asset is valued comprises the acquisition costs of the raw materials and consumables used and the other costs that can be directly attributed to production. The production cost may furthermore include a reasonable part of the indirect costs and the interest on debts over the period that can be attributed to the production of the asset; in that case the notes state that this interest has been capitalised.
What this means. If you make an asset yourself, such as finished-goods inventory, your own factory building or software for own use, the production cost consists at least of the materials and the costs you can link directly to the product: hours of own staff, hired contractors, permits. A reasonable part of the indirect production costs may be added, such as the depreciation of the workshop or the management of production. Selling costs do not belong in it, and other overhead only to the extent it was needed to bring the asset to its location and condition (RJ 220.309).
Interest may be added as long as the asset is under construction, provided the financing can be attributed to the construction. RJ 273.204 limits that to qualifying assets: assets whose construction or preparation necessarily takes a substantial time, and whose future yield covers the carrying amount including interest. If you choose to, you do it for all qualifying assets (RJ 273.206). Notional interest on equity you do not capitalise. The notes say that interest has been capitalised; RJ 273.302 asks medium-sized and large entities also for the amount and the interest rate used. See RJ 273 interest expenses.
Three situations in which the acquisition cost is not the invoice amount
- Purchase in foreign currency. A machine that you buy in dollars stands at the amount in euros at the rate on the transaction date. An exchange difference between that date and payment belongs to the debt, not to the asset (RJ 122; RJk A2, paragraph 4). An average rate per week or month may be used as an approximation.
- Investment grant. A grant for the purchase of an asset you may deduct from the acquisition cost or carry as an amount received in advance under accruals and deferred income (RJ 274.112). The result over the useful life is the same in both cases; the balance sheet looks different.
- Takeover of a business. If you take over an entire business, each acquired asset gets its fair value on the acquisition date as acquisition cost, and the remainder of the purchase price is goodwill (RJ 216; article 2:386).
Cost and notes per class
| Class | What applies |
|---|---|
| Micro (balance sheet total ≤ € 450.000, net turnover ≤ € 900.000, < 10 employees) | Paragraphs 1 and 2 as a valuation rule; no statement of capitalised interest (art. 2:395a(6) DCC) |
| Small (balance sheet total ≤ € 7,5 mln, net turnover ≤ € 15 mln, < 50 employees) | Everything; RJk A2.208 leaves it to you whether you state which indirect costs you capitalised |
| Medium-sized (balance sheet total ≤ € 25 mln, net turnover ≤ € 50 mln, < 250 employees) | Everything; for capitalised interest also amount and interest rate (RJ 273.302) |
| Large (balance sheet total > € 25 mln, net turnover > € 50 mln, ≥ 250 employees) | As medium-sized |
If a micro or small entity chooses tax-based policies, the cost follows the tax rules. Article 2:388 is unchanged in these three financial years. RJ 273 was amended for financial years from 2026; RJ 212 from 2025 and RJ 220 from 2026. For projects in progress, where the production cost plays a role in revenue recognition, see RJ 221.
Case: buying a machine and having a factory building built
Packaging company De Kade BV (fictional, medium-sized) buys a cutting machine in 2026 for € 200.000 with a 5% discount, pays € 3.000 for transport, € 7.000 for installation and € 42.000 deductible VAT. In addition it has a factory building built from 1 March to 31 December 2026, financed with a construction loan of € 1.500.000 at 5%.
| Component | Cutting machine (paragraph 1) | Factory building (paragraph 2) |
|---|---|---|
| Purchase price after discount / materials | € 190.000 | € 900.000 |
| Transport and installation | € 10.000 | – |
| Own staff on the construction | – | € 150.000 |
| Contractor | – | € 600.000 |
| Architect and permits | – | € 80.000 |
| Reasonable part of indirect costs (project management) | – | € 40.000 |
| Construction interest: € 1.500.000 × 5% × 10/12 | – | € 62.500 |
| Deductible VAT | not included | not included |
| Cost | € 200.000 | € 1.832.500 |
Check: 190.000 + 10.000 = 200.000; 900.000 + 150.000 + 600.000 + 80.000 + 40.000 + 62.500 = 1.832.500. The notes state that interest has been capitalised over the construction period: € 62.500 at 5%. If De Kade leaves the interest out of the production cost, the building stands at € 1.770.000 and the interest weighs on the 2026 result; it must then make the same choice for all its qualifying assets. Depreciation on the building starts at the start of use in January 2027 (article 2:386).
Mistakes in cost
- Including deductible VAT in the cost.
- Capitalising selling costs or general office costs as indirect production costs.
- Continuing to capitalise interest after the asset is ready for use.
- Capitalising interest on one project and not on another comparable project.
- Not stating capitalised interest in the notes, while paragraph 2 asks for it.
Sources
Frequently asked questions
What falls under the acquisition cost of an asset?
The purchase price and the incidental costs (art. 2:388(1) DCC): the purchase price after discounts, plus among other things transport, installation, import duties, notary costs and transfer tax. VAT that you can deduct does not belong to it.
May I capitalise interest during the construction of a property?
Yes. The production cost may include interest on debts over the period that can be attributed to production (art. 2:388(2) DCC). The RJ limits that to qualifying assets and then asks you to do it for all qualifying assets. The notes state that interest has been capitalised.
Which indirect costs may be in the production cost?
A reasonable part of the indirect production costs, such as the depreciation of the workshop and the management of production (art. 2:388(2) DCC). Selling costs do not belong in it; other overhead only to the extent it was needed to bring the asset to its location and condition.
May I capitalise interest on equity?
No. Article 2:388(2) DCC speaks of interest on debts. A calculated return on equity may not be included in the production cost.
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