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Why Grant Thornton
Whether you’re growing in one market or many, looking to operate more effectively, managing risk and regulation, or realising stakeholder value, our firms can help.
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Culture and experience
Grant Thornton’s culture is one of our most valuable assets and has steered us in the right direction for more than 100 years.
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Global scale and capability
Beyond global scale, we embrace what makes each market unique, local understanding on a global scale.
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Join our network
In a world that wants more options for high quality services, we differentiate in the market to grow sustainably in today’s rapidly changing environment.
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Leadership governance and quality
Grant Thornton International Ltd acts as the coordinating entity for member firms in the network with a focus on areas such as strategy, risk, quality monitoring and brand.
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Africa
24 member firms supporting your business.
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Americas
31 member firms, covering 44 markets and over 20,000 people.
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Asia-Pacific
19 member firms with nearly 25,000 people to support you.
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Europe
53 member firms supporting your business.
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Middle East
8 member firms supporting your business.
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Business consulting services
Our business consulting services can help you improve your operational performance and productivity, adding value throughout your growth life cycle.
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Business process solutions
We can help you identify, understand and manage potential risks to safeguard your business and comply with regulatory requirements.
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Business risk services
The relationship between a company and its auditor has changed. Organisations must understand and manage risk and seek an appropriate balance between risk and opportunities.
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Cybersecurity
As organisations become increasingly dependent on digital technology, the opportunities for cyber criminals continue to grow.
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Forensic services
At Grant Thornton, we have a wealth of knowledge in forensic services and can support you with issues such as dispute resolution, fraud and insurance claims.
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Mergers and acquisitions
We work with entrepreneurial businesses in the mid-market to help them assess the true commercial potential of their planned acquisition and understand how the purchase might serve their longer-term strategic goals.
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Recovery and reorganisation
Workable solutions to maximise your value and deliver sustainable recovery.
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Transactional advisory services
We can support you throughout the transaction process – helping achieve the best possible outcome at the point of the transaction and in the longer term.
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Valuations
We provide a wide range of services to recovery and reorganisation professionals, companies and their stakeholders.
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IFRS
At Grant Thornton, our IFRS advisers can help you navigate the complexity of financial reporting from IFRS 1 to IFRS 17 and IAS 1 to IAS 41.
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Audit quality monitoring
Having a robust process of quality control is one of the most effective ways to guarantee we deliver high-quality services to our clients.
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Global audit technology
Our global assurance technology platform provides the ability to conduct client acceptance, consultations and all assurance and other attestation engagements.
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Corporate and business tax
Our trusted teams can prepare corporate tax files and ruling requests, support you with deferrals, accounting procedures and legitimate tax benefits.
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Direct international tax
Our teams have in-depth knowledge of the relationship between domestic and international tax laws.
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Global mobility services
Through our global organisation of member firms, we support both companies and individuals, providing insightful solutions to minimise the tax burden for both parties.
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Indirect international tax
Using our finely tuned local knowledge, teams from our global organisation of member firms help you understand and comply with often complex and time-consuming regulations.
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Transfer pricing
The laws surrounding transfer pricing are becoming ever more complex, as tax affairs of multinational companies are facing scrutiny from media, regulators and the public
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Africa tax desk
A differentiating solution adapted to the context of your investments in Africa.
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Banking Holding banking to account: the real diversity and inclusion pictureWe explore how the banking sector can continue to attract, retain and nurture women to build a more diverse and inclusive future.
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Sustainability From voluntary to mandatory ESG: How banks can future-proof their operationsAs we move from voluntary ESG initiatives to mandatory legislation, we explore what the banking sector needs to prioritise.
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IFRS IFRS 9 - Audit of Expected Credit LossesGPPC releases The Auditor’s response to the risks of material misstatement posed by estimates of expected credit losses under IFRS 9
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growthiQ Steering your company to long-term successHistory has something important to tell us about the difficulties of steering a business to long-term success – through seismic shifts in technology, consumer demands and product development. With that in mind it’s unsurprising that over half the world’s largest companies in the early 1900s had shut their doors by the late 1990s. Some, however, have endured.
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International Financial Reporting Standards Implementation of IFRS 17 ‘Insurance Contracts’The auditor’s response to the risks of material misstatement arising from estimates made in applying IFRS 17 ‘Insurance Contracts’
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IFRS Get ready for IFRS 17After twenty years of development the IASB has published IFRS 17 ‘Insurance Contracts’, find out more.
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Global business pulse - industry analysis Mid-market recovery spreads to more industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - industry analysis A very uneven recovery across industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - Sector analysis Clear patterns of damage from COVID-19 across the industriesThe index results for 12 key sectors of the mid-market reveal just how much or little the various parts of the economy were impacted by COVID-19.
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Not for profit Mission: possible – putting impact at the heart of charityGlobal charitable continues to decline and charity leaders are increasingly looking at their own unique impact journey.
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Access to finance Raise finance to invest in changePrepare your business to raise finance to invest in change.
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Private equity firms Private equity in the mid-market: reshaping strategies for 2021When the global COVID-19 pandemic stormed across the globe in early 2020, the private equity sector was hit hard but deals are coming back to the market.
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Mid-market businesses Getting ready for private equity investmentOur specialists explore how private equity firms are now working with their portfolios and how the mid-market can benefit from investment.
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Mid-market businesses Myth-busting private equityNervous about partnering with Private Equity? We explore some of the common myths we come across when speaking to mid-market businesses about PE investment.
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Public sector Helping build the government of tomorrow, todayLearn about the Grant Thornton US public sector team.
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Global business pulse - industry analysis Mid-market recovery spreads to more industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - industry analysis A very uneven recovery across industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - Sector analysis Clear patterns of damage from COVID-19 across the industriesThe index results for 12 key sectors of the mid-market reveal just how much or little the various parts of the economy were impacted by COVID-19.
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Industries European Real Estate PodcastJessica Patel, Tax Partner at Grant Thornton UK speaks with tax partners and directors across the network to share their insights on the real estate market and some of the challenges.
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Industries European Real Estate PodcastJessica Patel, Tax Partner at Grant Thornton UK speaks with tax partners and directors across the network to share their insights on the real estate market and some of the challenges.
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Global business pulse - industry analysis Mid-market recovery spreads to more industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - industry analysis A very uneven recovery across industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - industry analysis Mid-market recovery spreads to more industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Global business pulse - industry analysis A very uneven recovery across industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Retail How retail is positioning for successCOVID-19 provided some hard lessons for the retail industry. It is time to turn those into sustainable and well executed growth strategies in 2021.
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Telecoms Can tech and telecom leverage economic headwindsAs most businesses brace for an economic downturn, tech and telecom could see new prospects. But, to turn the headwinds to your advantage, you need to find your unique opportunities and risks.
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Technology Mid-market tech companies lead the way on diversity and inclusionWe explore how the mid-market tech sector can continue to build and nurture a culture that’s increasingly more diverse and inclusive for women.
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Technology Responding to slowing growth: why the tech industry faces a more challenging outlook in 2022We spoke to tech experts about industry trends that could affect companies over the next 12 months and what their short-term strategic priorities should be.
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Tax Resetting global tax rules after the pandemicBusinesses are seeing rising challenges, and finance heads are dealing with a range of new measures. To say the next 12 months are critical for businesses is an understatement.
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Telecoms Can tech and telecom leverage economic headwindsAs most businesses brace for an economic downturn, tech and telecom could see new prospects. But, to turn the headwinds to your advantage, you need to find your unique opportunities and risks.
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TMT TMT industry: Fully charged or on standby?Our research revealed five key trends that resonated with Technology, Media and Telecoms (TMT) industry leaders around the world. We asked a panel of our experts from UK, US, India Ireland and Germany, to give us their reaction to the findings.
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Cybersecurity One size fits nothingTechnology companies must adopt a new approach to digital risk: those that successfully develop a reputation for digital trust by demonstrating an unwavering commitment to cyber security and data privacy will be able to carve out a competitive advantage.
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Technology, media & telecommunications Why it’s time for a 5G reality checkFigures suggest the mobile sector is maturing. While data usage continues to soar, mobile revenues are expected to flatten out over the next few years.
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International business Mid-market businesses lifted by rising tide of optimismOptimism among global mid-market business leaders rose to 67% in the first half of this year and they are markedly more optimistic about their prospects with global optimism having increased by 8%.
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Global business pulse - industry analysis Mid-market recovery spreads to more industriesThe index results for 13 key industries of the mid-market reveals a very uneven recovery from COVID-19
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Hotels COVID-19: Checking in with the hotel industry one year onCOVID-19 provided some hard lessons for the hotel sector. It is time to turn those into sustainable and well executed growth strategies.
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Women in Business 2024
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COP28: Mid-market firms should seize the opportunity from adaption and innovation
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Women in tech: A pathway to gender balance in top tech roles
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Women in leadership: a pathway to better performance
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Women in Business 2024
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Women in business: Regional picture
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Pathways to Parity: Leading the way
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IFRS Alerts
IFRS Alerts covering the latest changes published by the International Accounting Standards Board (IASB).
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Example Financial Statements
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Insights into IFRS 2
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IFRS 3
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IFRS 16
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IFRS 17
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International indirect tax guide
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Global transfer pricing guide
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Expatriates taking up employment in Belgium will be subject to comprehensive rules and, in some cases, employment visa requirements.
The Global Mobility Services team at Grant Thornton Belgium can help expatriates and their employers to deal with the Belgian visa and work permit requirements, with Belgian labor law and social security issues, as well as with Belgian income tax items.
In particular, we can assist expatriates and their employers to identify Belgian tax planning opportunities, review tax equalization policies, as well as providing compliance services regarding Belgian tax filing requirements. Please note that we – as Grant Thornton Belgium – cannot render actual payroll compliance services which are typically provided by dedicated Belgian payroll agents.
Expatriates may qualify for a special tax regime for international inbounds. We can prepare the formal application for the special tax regime to be submitted to the competent tax office.
Click on each of the areas below to expand for more information:
The Belgian government has decided to reform the old expat regime, also known as the special tax regime for foreign executives and researchers temporarily employed in Belgium of 1983. As from January 1, 2022 a new Belgian special tax regime for inpatriate workers and Belgian special tax regime for inpatriate researchers have come into place.
Belgian residency under both tax regimes
Opposed to the old system, where expatriates were considered as 'non-residents' for Belgian income tax purposes regardless of their factual situation, the persons qualifying for the new regimes will be subject to the regular tax residency rules foreseen in article 2 of the Belgian Income Tax Code (hereafter BITC). This should avoid 'statelessness’ since most expatriates are no longer tax residents in their country of origin.
However, please note that it is also possible to be considered as Belgian tax non-resident under the new expat regime. On top of meeting the conditions resulting from article 2 BITC mentioned above, the inpatriate worker or researcher can be required in any given year during the activity in Belgium to produce tax residency certificate from the tax administration of his country of residence.
Old regime
Expatriate concessions
Foreign executives or specialists qualifying for the special non-resident tax status of 1983 are taxed on all income derived from their employment activity (salaries, bonuses, fringe benefits,…) from which are excluded the portion of the employment income related to the number of days worked outside of Belgium (so-called 'travel exclusion').
Special rules apply for the determination of the foreign working days certain expatriate allowances or expense reimbursements (see further). The foreign nationals qualifying for the special non-resident tax status will not be taxed on supplementary recurring and non-recurring expenses which are incurred because of their recruitment or transfer to Belgium, whether paid as lump sum allowances or as specific reimbursements of expenses (i.e. housing allowances, cost of living allowances, tax equalisation, home leave, school fees at an international school, etc).
Depending upon the function exercised by the foreign executive, the maximum annual excludable expenses or allowances amount to EUR 11,250.00 or EUR 29,750.00. However, the above ceilings do not include reimbursement of school fees or the reimbursement of moving expenses.
As already indicated, these foreign executives are considered to be non-residents for tax purposes (in the old regime). As such, they cannot claim tax treaty benefits as a Belgian tax resident.
The conditions to obtain the special tax status can be summarized as follow:
- the employing company must be part of an international group
- the employing company must be a commercial organization
- the expatriate must be a foreign national
- the expatriate must exercise a managerial function
- the expatriate must demonstrate that he/she has kept the centre of their economic interests outside of Belgium.
There is principally a requirement for the expatriate’s employer to deduct Belgian withholding taxes from the assessable employment income. The amount of withholding taxes is determined according to specific tables provided by the tax administration. The employer can deviate from these tables directly implementing the tax benefits of the special tax status by reducing the amount of withholding tax withheld.
As mentioned earlier, the special tax regime described above is currently phasing out and won’t be applicable after 31 December 2023.
Phase out
As from 1 January 2022 the old tax regime can no longer be applied for (except on behalf of expatriates who had arrived in Belgium between 31 July 2021 and 31 December 2022). However, Belgian tax authorities have indicated that the old tax system may continue to be applied until 31 December 2023, provided that the conditions of the old regime are complied with and the employee or director at hand already benefitted from it on 1 January 2022.
Expatriates benefitting from the old Belgian special tax regime for foreign executives and researchers of 1983 have received the possibility to maintain the current status until 31 December 2023.
New regime
As mentioned above, Belgian tax authorities have created a new Belgian tax regime for inpatriates and inpatriate researchers. The underlying tax bill has been published on 27 December 2021.
In essence, the new system offers the benefit that, for a certain period of time a special regime can be applied with regard to 'costs proper to the employer' specific to inpatriates and inpatriate researchers that can be reimbursed tax-free. Furthermore, a (partially) flat-rate calculation that should result in an administrative simplification is introduced.
In case of inpatriate employees or directors who receive a renumeration, the reimbursement of certain expenses by the employer or company, within the conditions and limits stipulated in Article 32/1 of the BITC is considered a reimbursement of a cost proper to the employer.
Entitlement to the special tax scheme
The below listed conditions need to be fulfilled for the individual to be able to apply for the new special tax regime for inpatriates:
- Employee or company director who is directly recruited abroad or assigned to Belgium by a company (including non-profit organizations) that is part of a multinational group
- In 5 years (60 months) before the start of employment in Belgium:
- Not have been considered a Belgian resident taxpayer
- Not have resided less than 150 km from the Belgian border
- Not have had any taxable employment income as a Belgian non-resident
- Minimum annual remuneration of EUR 75,000
Please note that a separate tax regime for inpatriate researchers was introduced with similar conditions to those for the special tax regime for inbound taxpayers. The researchers must comply with specific conditions regarding diplomas or professional experience (i.e. minimum 10 years of relevant experience). In addition, the researcher must devote at least 80% of their working time to research activities. Lastly, directors are excluded from the special tax regime for researchers. However, the researchers are not subject to the minimum earnings threshold of EUR 75,000.
Advantages: costs proper to the employer
The following expenses can be considered as reimbursements of costs proper to the employer:
- One-time costs on the occasion of the move to Belgium;
- Furnishing costs of the house in Belgium;
- School fees for the children of the inpatriate (and their partner, in Belgium);
- A lump-sum amount of recurring expenses, with a maximum of 30% of the gross salary effectively taxed in Belgium.
End of the regime
The regime can be applied for an initial period of five years, with a one-time extension of three years (thus, maximum eight years in total). Failing to meet the minimum salary condition in any given year during that period will result in the interruption of the special tax regime on behalf of the inpatriate . In principle, the application of the new regime is definitively lost.
In our opinion, it will be possible to reapply for the regime, if proof of an uninterrupted period of five years of absence from Belgium can be presented(along with all other conditions).
For more information about the new regime, please refer to the dedicated section of the website of our Belgian firm.
Before 1 January 2019 the employers of non-EEA (European Economic Area) nationals usually needed to apply for a work permit prior to the employee taking up employment in Belgium and the employee needed to obtain a labour card.
The expatriate also had to obtain a residence permit to be allowed to live in Belgium. Where the expatriate’s spouse and family relocate to Belgium, relevant residence permits and separate work permits (where the spouse will also work) will be required. Where the expatriate is an EEA national the above procedure is usually not required.
Since 1 January 2019, non-EEA nationals who wish to work and stay in Belgium for more than 90 days must apply through their employer for a 'single permit' with the competent regional authority. If this request is accepted, he receives a single document attesting that he is authorized to work and stay more than 90 days in Belgium.
The Belgian tax year runs from 1 January to 31 December. Pease note that in Belgium the tax return for income year ‘x’ needs to be filed in year ‘x+1’, the so-called tax year. For example, the tax return over income year 2023 will need to be declared in 2024 (income year 2023, tax year 2024).
Individuals who are Belgian resident for tax purposes must file their tax return at the latest on the due date indicated on the tax return (generally 30 June). When no return is received, the taxpayer should request one by 1 June at the latest.
Belgian tax non-residents are only entitled to file a yearly tax return if they effectively received income taxable in Belgium during the income year at hand.
The filing deadline for Belgian tax non-resident tax returns typically falls later in the tax year.
Taxpayers providing their tax consultant a proxy to file the tax return on their behalf through the so-called Tax-on-Web application are granted an extended filing due date till later in the year.
For employees and directors, taxes are normally already withheld. In case an additional Belgian tax liability is nevertheless due, taxes will become payable within a period of two months following the receipt of a tax bill. Married taxpayers (or legal cohabitants) file a joint income tax return. However professional income is taxed separately on behalf of each taxpayer. Investment income and real estate income is taxed on behalf of the member of the household who is the legal beneficiary of this type of income.
Tax year 2024 – income year 2023
Taxable income | Tax payable |
---|---|
EUR 0 – EUR 15,200 | 25% |
EUR 15,200 – EUR 26,830 | 40% |
EUR 26,830 – EUR 46,440 | 45% |
> EUR 46,440 | 50% |
All tax amounts of Belgian tax residents are increased by the applicable municipality taxes, which are imposed at rates between 0% and 9%. The municipality tax is calculated on the amount of income tax due.
For non-residents, the final tax due is computed in the same manner as for Belgian residents, with personal allowances being allowed if non-residents are taxable on at least 75% of their worldwide income in Belgium. No municipality tax is due, but an additional federal tax at a flat rate of 7% on the amount of the individual’s income tax is payable.
A tax-free amount of EUR 10,160 (for TY 2024) is normally available, possibly increased for dependent children and specific circumstances. Lump sum (up to EUR 5,520 for employees) or itemized business expenses can be deducted.
Special flat rates apply to different type of income depending on their nature (severance payments, accrued capital under life and group insurance contracts, etc.) but regular progressive tax brackets are in principle automatically applied whenever they appear to be more advantageous.
Sample income tax calculation for a single taxpayer, without dependent children.
Gross salary | 50,000.00 |
Cost of living allowance | 10,000.00 |
Total employment Income: | 60,000.00 |
Social security contributions (13.07%) | (7,842.00) |
Standard business expenses | (5,520.00) |
Taxable salary: | 46,638.00 |
Income tax | 14,835.50 | |
0 - 15,200 | 25% | 3,800 |
15.200 - 26,830 | 40% | 4,652.00 |
26,830 - 46,440 | 45% | 8,824.50 |
46,440 - 46,638 | 50% | 99.00 |
Less tax-free amount: 0 - 10,160 | -25% | (2,540.00) |
Municipality taxes (7%) | 1,038.49 | |
Special contribution for social security | 555.53 | |
Total income tax | 16,429.52 |
The residents of Belgium are taxed on their worldwide income in Belgium and the non-residents on their Belgian source income.
Under Belgian tax law, the place of tax residence is governed by several criteria and is generally defined as the place where an individual has their permanent home (i.e. generally where the family is living) or where an individual has their centre of economic interest (i.e. place where an individual manages their private affairs).
The Belgian tax code provides also for a refutable assumption that an individual is a tax resident of Belgium when he/she is registered in the National Register of individual persons in Belgium. This registration takes place in the municipality where the individual resides. Moreover, the Belgian tax code provides for an irrefutable assumption of tax residency when in case of marriage or legal cohabitation, the family resides in Belgium.
However, expatriates (certain foreign executives, specialists and researchers) who are subject to the old expat regime, are considered as tax non-residents during the whole period of their assignment to Belgium (see above 'expatriate concessions'). On the other hands, inpatriates and inpatriate researchers who qualify for the new regime, are subject to regular tax residency rules.
Belgian tax law provides for the following four categories of taxable income:
- Earned income, including employment income, director fees, self-employment income, business income and retirement income
- Real estate income
- Investment income, including dividends, interest and royalties
- Other miscellaneous income.
For each category of income the net taxable amount is determined as the gross income received minus a number of deductions specific to the income category. In addition, several deductions and allowances can be set off against the total net taxable income.
As mentioned above, where duties are performed in Belgium, any remuneration received in respect of these duties is treated as Belgian sourced income and may, therefore, be subject to Belgian income tax (pursuant the provisions of the relevant double taxation treaty).
In general, if the benefit is granted in Belgium, a Belgian income tax charge will arise. Therefore, housing, meal allowances, provision of a car and relocation allowances will come within the charge to Belgian income tax in addition to the individual’s salary.
Where income has been subject to tax twice (in Belgium and a foreign jurisdiction) expatriates who are Belgian tax residents may be granted relief by the Belgian tax authorities where provided for in the relevant double taxation treaty or relevant internal tax legislation.
In determining the taxable amount of the employment income, compulsory social security contributions paid either in Belgium or abroad are fully tax deductible. Professional expenses can be claimed either by itemising the expenses actually made or on a lump sum basis using the standard business expenses deduction. A wide range of deductions may be taken against the net income subject to conditions and limitations.
Most allowances are however only available to non-residents if they earn at least 75% of their worldwide income in Belgium.
Tax reductions are granted either by the federal or regional government for specific expenses such as life insurance premiums, the purchase of service vouchers, childcare expenses, charitable contributions, etc.
A law of December 2017 introduced, in the event of a change of tax residence during the calendar year, a limitation on certain tax benefits. The latter limitation is applied pro rata temporis.
In general, capital gains are tax free in Belgium. Only capital gains on Belgian real estate (short-term assets) may be taxable under certain conditions.
Inheritance tax rules and taxes differ according to the Region where the deceased had their fiscal residence in Belgium.
Substantial differences exist between the rates applied by each regional authority. Special rules apply with respect to the transfer of a family-owned business and to the transfer of a family home to a surviving spouse, legal cohabitant or other cohabitant (except in direct line). Readers should obtain up-to-date information regarding these rules.
Under existing law, the estate of a deceased resident consists of the resident’s worldwide assets. Belgian jurisdiction over estates of deceased non-residents is limited to the non-residents’ real estate located in Belgium. The definition of resident for inheritance tax purposes may differ from the definition used for income tax purposes. Non-resident status for purposes of the special expatriate tax regime (see Section A) does not automatically apply for inheritance tax purposes.
Inheritance taxes and gift taxes on donations of immovable property are levied according to sliding scales, depending on the beneficiary’s relationship to the deceased or donor. However, preferential flat rates apply to gifts of movable property.
Gifts are subject to gift taxes (but many exceptions can apply). Transfer taxes apply to various asset (principally property) transfers and leases at rates ranging from 0.2% to 12.5%.
The expatriate’s Belgian tax residency status will determine whether investment income such as interest, dividends etc., will become liable to Belgian income tax.
Interests are in principle subject to a withholding tax of 30% (15% under some conditions). Dividends are taxed at a rate of 30% (lower rates may apply under certain conditions), and the first EUR 800 are exempted. Belgian tax non-residents (therefore including expatriates benefitting from the old special tax regime) may only be taxed on Belgian source interest and dividend income.
Royalties can be subject to a specific taxation to the extent that they are not regarded as a professional income.
A tax is levied on the annual rental value of the immovable property. The rate varies according to the region in which the property is located.
Since 2021, resident taxpayers who own real estate abroad must report the cadastral income of their foreign property in their Belgian tax return. The Administration will determine the rental value of this foreign real estate based on a submitted declaration.
Where duties are performed in Belgium, a charge to Belgian Social Security may arise. When the expatiate is treated as an employee, he/she will be subject to personal social security contributions of 13.07%, this rate applies to the monthly gross compensation without ceiling. The employer will also be required to contribute about 25% of the relevant income and benefits to Belgian social security system.
Social security contributions must be collected at source along with the withholding taxes.
Different rates apply to self-employed activities, including activities of directors. For income year 2023, social security contributions are levied at a rate of 20,5% on net income up to EUR 70,857.99 and at a rate of 14.16% on income between EUR 70,857.99 and EUR 104,422.20. Income in excess of EUR 104,422.20 is not subject to social security contributions. The annual maximum contribution for self-employed activities is therefore EUR 19,278.59 (increased by 3% to 5% for administration fees for the social insurance fund).
Mandatory social security contributions are deductible for income tax purposes.
An individual who is liable to Belgian social security contributions is also liable to a special social security contribution.
The maximum amount of this contribution is EUR 731.28. The special social security contribution is not deductible for income tax purposes. For self-employed workers and directors, the special social security contribution is included in the above-mentioned rates for self-employed activities.
Where the expatriate is seconded from an EU jurisdiction and holds the relevant documentation (A1) an exemption to Belgian Social Security will apply (limited in time – usually five years).
Where the expatriate is seconded from a jurisdiction outside the EU with which Belgium holds a Bi-Lateral Agreement and the expatriate holds the relevant documentation (certificate of coverage), an exemption to Belgian Social Security will apply (limited in time).
Where the expatriate is transferring from a jurisdiction that does not fall into one of the above categories, the Belgian rules will determine his liability to Belgian social security taxes.
Expatriates benefiting from the special tax status who are subject to Belgian social security are allowed to exclude the tax-free allowances also from social security. Moreover, under certain circumstances this tax-free allowance can be increased with the travel exclusion resulting in an additional social security saving (both for the employee and the employer).
The taxable moment is at the time of “grant” of the stock options under the condition that the employee accepts the offer in writing within the sixtieth day following the offer date. The taxable benefit is at that moment determined on a lump-sum basis.
The basic rule is that the taxable benefit amounts to 18% of the value of the underlying shares for an option valid for a maximum of five years. This percentage is increased by one percent per year started after the five-year maturity period of the option. The percentage thus obtained can even be reduced by half if certain conditions are met. Normally, the taxable benefit is exempted from social security contributions. The capital gain realised upon exercise and sale of the shares is tax-free.
When the offer of the options is not accepted within the sixty-day period referred to above, taxation will occur at exercise. The taxable benefit will be determined as the positive difference between the market value of the shares at exercise and the exercise price. Social Security contributions will normally also be due. Subsequent capital gains upon sale of the shares are tax-free.
An annual solidarity tax of 0.15% is now applicable on securities accounts that reach or exceed EUR 1.000.000 also known as the Tax on Securities Accounts.
For foreign nationals who do not qualify for the special tax regime and who perform their duties (partially) outside of Belgium, split payroll arrangements could be considered which generally reduces the overall tax burden.
Company cars normally constitute a tax effective fringe benefit.
Deferred compensation schemes can be set up subject to certain conditions. Stock options offered by a foreign employer are preferably granted before the assignment to Belgium as taxation may occur at grant.
For further information on expatriate tax services in Belgium please contact:
Bart Verstuyft
E bart.verstuyft@be.gt.com
Samuel Leblanc
E samuel.leblanc@be.gt.com