Article 2:390 DCC: the revaluation reserve explained per paragraph
Article 2:390 DCC ensures that an increase in value that has not yet been turned into cash is not distributed: it goes to a revaluation reserve that is not freely available.
The short answer
Article 2:390 DCC requires a revaluation reserve for increases in value of tangible and intangible fixed assets and inventories that you value at current value, and also for unrealised profit on assets without a frequent market quotation that has run through the result. The reserve is no higher than the difference from cost, is released on sale and may be reduced by deferred tax.
Updated 30 October 2026
Key facts
| Place in the law | Section 6 of Title 9 |
| Character | Legal reserve: not distributable (art. 2:373(4) and 2:216 DCC) |
| Ceiling | Difference between the carrying amount on a cost basis and the carrying amount at current value (paragraph 3) |
| Small | Statement of changes mandatory for this reserve (art. 2:396(5) DCC) |
| Micro | May not value at market value; current cost for fixed assets is allowed (RJk M1.303) |
| Elaboration | RJ 240 and RJk B8 (reserve), RJ 212 and 213 (fixed assets and investment property), RJ 272 (deferred taxes), RJ 121 (write-down) |
Paragraph 1: when you form a revaluation reserve
1. Increases in value of tangible fixed assets, intangible fixed assets and inventories that are not agricultural inventories are recognised in a revaluation reserve. Increases in value of other assets that are valued at current value are recognised in a revaluation reserve, unless they are credited to the result under article 384. Furthermore, the legal entity forms a revaluation reserve at the expense of the free reserves or from the result of the financial year, to the extent that in the financial year increases in value of assets that are still present at the balance sheet date have been credited to the result of the financial year. A revaluation reserve is not formed for assets referred to in the previous sentence for which frequent market quotations exist. Up to the amount of deferred losses on financial instruments charged to the revaluation reserve as referred to in article 384 paragraph 8, no distributions may be made at the expense of the reserves. The revaluation reserve may be reduced by deferred tax liabilities relating to assets that have been revalued to a higher amount.
What this means. There are two routes. If you value a property, a machine or inventory at current value, the increase goes directly to the revaluation reserve, not to profit. If you value investments or financial instruments at current value with the increase in profit (art. 2:384(7) DCC), you still form a revaluation reserve from the free reserves or the result, as long as the asset is still there. That applies, for example, to an investment property (RJ 213.504; RJk B2.206). Only for assets with frequent market quotations, such as listed shares, is that not needed: that profit can be cashed in at any moment.
Two particulars. If you hedge a future transaction with a derivative and there is a loss in the revaluation reserve (art. 2:384(8) DCC), you may distribute nothing from the reserves up to that amount. And you may reduce the reserve by the deferred tax weighing on the revaluation; RJk B8.110 calls the sum of reserve and deferred tax the gross revaluation.
Paragraphs 2 to 5: converting, ceiling, sale and write-down
2. The revaluation reserve may be converted into capital.
3. The revaluation reserve is no higher than the difference between the carrying amount on the basis of the acquisition or production cost and the carrying amount on the basis of the current value applied in the valuation of the assets to which the revaluation reserve relates. This reserve is reduced by the amount included in the reserve in respect of a particular asset if that asset is disposed of. An impairment of an asset valued at current value is charged to the revaluation reserve to the extent that this asset was previously revalued upwards in favour of the revaluation reserve.
4. The reductions of the revaluation reserve that are credited to the profit and loss account are presented in a separate item.
5. The notes set out whether and in what way, in connection with the revaluation, account is taken of the effect of taxes on equity and result.
What this means. The reserve may be used for an issue of bonus shares (paragraph 2), but not for a distribution in cash. It is never larger than the difference between the carrying amount at current value and the carrying amount the asset would have on a cost basis, with cumulative depreciation included (paragraph 3; RJ 212.414). If you depreciate a revalued property, that difference gets smaller every year, and the reserve falls with it. If you sell the asset, the part of the reserve that goes with it is released. If the value falls, the fall first comes off the reserve and only then goes through the result.
If part of the reserve is released in favour of the profit and loss account, it appears on a separate line (paragraph 4); RJk B8.110 places that line directly before the financial income and expenses. More often the reserve is released to the other reserves, outside the result. In the notes you say whether and how you take tax into account (paragraph 5); see deferred tax and RJ 272.
The revaluation reserve per class
| Class | What applies |
|---|---|
| Micro (balance sheet total ≤ € 450.000, net turnover ≤ € 900.000, < 10 employees) | No market value (art. 5a Current Value Decree); current cost for tangible and intangible fixed assets is allowed (RJk M1.303). The reserve then belongs to it, but is not shown separately: equity is one item. No notes under paragraph 5 |
| Small (balance sheet total ≤ € 7,5 mln, net turnover ≤ € 15 mln, < 50 employees) | Full; the revaluation reserve is the only item for which it shows the movements (art. 2:396(5) DCC), and the sum of the revaluations at the balance sheet date (art. 2:396(3) DCC with art. 2:368(2) under a) |
| Medium-sized (balance sheet total ≤ € 25 mln, net turnover ≤ € 50 mln, < 250 employees) | Full, in the full statement of changes |
| Large (balance sheet total > € 25 mln, net turnover > € 50 mln, ≥ 250 employees) | Full |
With tax-based policies (micro and small) revaluing to a higher value is not at issue: for tax purposes you do not value above cost. Whoever chooses tax-based policies and also keeps a revaluation reserve mixes two systems. For 2025, 2026 and 2027 article 2:390 applies in the same wording, including the possibility of deducting the deferred tax. RJ 240 applies in the edition for financial years from 2027; RJk B8 has been unchanged since 2024. Elaboration: RJ 240 equity, RJ 212 and RJ 213 investment property.
Case: an office building at current value and an investment property
Engineering firm Hofzicht BV (fictional, medium-sized) values its own office building at current value from 2026. On a cost basis the building stands at € 800.000 at the end of 2026; the current cost is € 1.100.000. It calculates the deferred tax at 25,8%. In 2028 the current value falls to € 750.000, while the carrying amount on a cost basis is then € 760.000. In addition Hofzicht owns a let investment property at fair value, which rises € 200.000 in value in 2026; that rise runs through the profit and loss account.
| Moment | Calculation | Revaluation reserve |
|---|---|---|
| Office building end of 2026 | Revaluation 1.100.000 − 800.000 = € 300.000; deferred tax 25,8% = € 77.400 | € 222.600 |
| Investment property 2026 (paragraph 1, third sentence) | Rise € 200.000 via the result; reserve from free reserves, after deferred tax 25,8% | € 148.400 |
| Office building 2028 | Current value € 750.000 is below the cost basis € 760.000: reserve for this building to zero, € 10.000 charged to the result | € 0 (for the office building) |
Check: 300.000 − 77.400 = 222.600; 200.000 × 74,2% = 148.400. In 2028 the revaluation, which had already fallen through depreciation in 2027 and 2028, is first charged to the remaining reserve and the deferred tax; only the part below the cost basis, € 10.000, goes through the result. Hofzicht states in the notes that it forms the reserve after deduction of deferred tax (paragraph 5). As a small BV, Hofzicht would show both amounts in the movement statement of the revaluation reserve; as a micro entity it could not value the investment property at fair value.
Mistakes with the revaluation reserve
- Taking an unrealised increase in value of an investment property into profit without forming a revaluation reserve.
- Forming a revaluation reserve for listed shares whose increase runs through the result; that is not needed.
- Leaving the reserve after the property is sold.
- Booking a fall in value directly in the profit and loss account while there is still a revaluation reserve for the same asset.
- Revaluing in annual accounts on tax-based policies.
How it works at Jaarrekening.io
In the equity worksheet you book the revaluation gross, the deferred tax on it as a separate movement and the realisation as a transfer, so the movement of the reserve stays visible. If you choose tax-based policies and a revaluation or deferred tax is nevertheless in the figures, the app warns you. The first annual accounts in your account are free, for every size class.
Sources
- Art. 2:390 BW: revaluation reserve (wetten.overheid.nl)
- Art. 2:384 BW: value changes in the result (wetten.overheid.nl)
- Art. 2:373 BW: legal reserves (wetten.overheid.nl)
- Art. 2:396 BW: small: movement of the revaluation reserve (wetten.overheid.nl)
- Besluit actuele waarde (wetten.overheid.nl)
- RJ bundle for medium-sized and large entities (rjnet.nl)
- RJk bundle for micro and small entities (rjnet.nl)
Frequently asked questions
When must I form a revaluation reserve?
If you value tangible or intangible fixed assets or inventories at a higher current value, and also if an unrealised increase in value of another asset has run through the result while that asset is still on the balance sheet at the balance sheet date and has no frequent market quotation, such as an investment property (art. 2:390(1) DCC).
May the revaluation reserve be distributed?
No. It is a legal reserve and does not count towards the distributable amount (art. 2:216 DCC for the BV). It may be converted into capital (art. 2:390(2) DCC). After the asset is sold, the corresponding part is released and is then available.
May I deduct the deferred tax from the revaluation reserve?
Yes. The revaluation reserve may be reduced by the deferred tax liability weighing on the revalued assets (art. 2:390(1), last sentence, DCC). In the notes you set out whether and how you take taxes into account (paragraph 5).
What happens to the revaluation reserve if the asset becomes worth less?
The fall in value is first charged to the revaluation reserve, to the extent the asset was previously revalued upwards (art. 2:390(3) DCC). Only the part above that goes through the profit and loss account.
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