Belgium legal and accounting and tax considerations in 2024

• Tax rates

  1. The standard corporate tax in Belgium is 25%. However, SMEs can benefit from reduced corporate tax rates of up to 20% on the first bracket of EUR 100,000 profit;
  2. All companies must file corporate tax returns by June the 30^th and pay corporate tax in installments usually from September. Noncompliance is subject to penalties of up to 200% the amount due;
  3. The standard VAT rate is 21%. VAT filings are to be done i) on a quarterly basis for companies with annual sales below €1 million and ii) on a monthly basis for companies with annual sales below that threshold;
  4. Dividends and capital gains are subject to corporate tax at the standard rate. Transfers between parent-subsidiary companies are however eligible for a 95% rebate on corporate tax, provided i) the parent company has held at least 10% of the total share capital for over one year and ii) the distributing company’s earnings have been subject to corporate tax;
  5. A 30% withholding tax is applied on dividend and interest payments to non EU resident companies, unless reduced via a tax treaty;
  6. A Belgium branch of a foreign company is subject to corporate tax at the standard rate;

• Miscellaneous information

  1. Annual losses can be carried forward indefinitely. Carry back of losses is however not allowed in Belgium;
  2. All employers and employees must pay social security contributions amounting to 38% in total of the employees’ gross salary;
  3. Belgium has signed double taxation treaties with 85 countries including Australia, Canada, China, Singapore, Malaysia, Indonesia and the USA to reduce withholding tax on payments abroad;
  4. Healy Consultants Compliance Department will assist our Clients with i) documenting and implementing accounting procedures ii) implementing financial accounting software iii) preparation of financial accounting records and iv) preparing forecasts, budget and sensitivity analysis;

• Legal and compliance

  Like France, Belgium is a heavily regulated country with a fairly complex Labor Code. Entrepreneurs are also often surprised to find out that regulations and reporting requirements are to be complied with either in French, Flemish or German depending to the part of Belgium where they start their business. Further information follows:

  • Reporting Regulations

    • All Belgium companies are required to open a corporate bank account in Belgium. The bank details will be disclosed both to the authorities and to the general public, as such information is viewable online;
    • All Belgium companies must also maintain up to date company records with the Companies Registrar. All company details including i) its registered address ii) its capital and iii) names of each shareholder and director will be available online;
    • All Belgium companies must file their financial statements with the Companies Registrar within one month after approval by the general meeting of shareholders;
    • All Belgium JSCs must file audited financial statements. For LLCs, audit is only required if the company has either i) more than 50 employees ii) annual sales over €7.3 million or iii) assets over €3.7 million;
    • The language in which all requirements applicable to a company must be fulfilled vary from place to place. Belgium is divided between French speaking and Flemish speaking provinces (Wallonie and Flanders), with also a few German-speaking districts.

  • Staff Regulations

    • An employment contract must be put in writing. It should be noted that the contract must be i) in French in the French speaking areas of Belgium (Wallonie) ii) in Flemish in its Flemish speaking parts (Flanders) or iii) in German in a few districts concentrated in Eastern Belgium;
    • Employees in Belgium are hired on i) open ended contracts (CDI) for permanent positions or ii) fixed term contracts (CDD) for temporary positions. CDD are usually limited to durations of up to 24 months (up to 36 months with prior authorization from the authorities) and will be deemed as open-ended contracts after that period;
    • The national minimum salary is approximately €1,450 per month. However, collective agreements provides for higher minimum wages in most industries;
    • Kindly note that probation periods are not allowed anymore in Belgium employment contracts. All dismissed employees can now request a notice period of three months for each 5-years period with the company, although the Labor Code provides for slightly more flexible rules to dismiss employees earning over €30,000 per year;
    • The standard working time is 38 hours a week but collective agreements may allow for a longer weekly working time in exchange for longer paid annual leave;
    • Belgium Laws bar discrimination in matters of employment on the grounds of gender, sexual preferences, ethnicity or race, religion and political or union affiliation.

  • Collective Bargaining and Labor Unions Regulations

    • Companies with more than 100 employees are required to elect at least 6 employee delegates who i) have a right to take up individual and collective employees concerns and ii) cannot be dismissed without the authorities’ approval;
    • Companies with more than 50 employees must setup a company health and safety committee, responsible for the implementation of health and safety rules and which must be informed of decisions likely to affect employees;
    • Collective bargaining takes place every two years at the industry level between representatives of labor unions and employers associations. All companies within the industry must then implement collective agreements agreed during the negotiations;
    • It is also possible to reach a collective agreement at the company level. It will however only be valid if the agreement i) provides for higher employee protection than the agreement signed at the industry level and ii) has been signed by a trade union representative not employed by the company.