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Industrial policy is a regional competence, so that regimes are different in Flanders, Wallonia and Brussels. Various types of investment grants and tax breaks are available.




I0.I Special tax regime for expatriates


Under certain conditions determined by the administration, foreign executives temporarily assigned to work in Belgium within an international group of companies can benefit from a special tax regime. They are treated for tax purposes as non-residents, and are therefore taxable on their Belgian source income only.

The special expatriate status offers two important tax advantages to foreign executives:

• Reimbursements made by the employer to cover additional expenses incurred as a direct result of employment in Belgium are within certain limits treated as non-taxable for the expatriate. These expenses include non-recurring expenses (such as moving expenses) and recurring expenses (such as costs of education for children in primary or secondary schools, differences in costs of living, etc.); and

• Salary related to business activities carried out abroad, calculated pro rata temporis, is exempt from Belgian income tax even when borne by a Belgian employer.

Other income is taxable in Belgium only if it stems from a Belgian source.

I0.2 Private income from capital

The normal tax regime of Belgian residents includes a few interesting features :

• Capital gains on privately held real estate are tax exempt (provided land has been held for more than 8 years and buildings are used as a main residence or have been held for more than 5 years);

• Capital gains on securities are tax-exempt as a rule provided they are realized within the scope of the normal management of private assets.

• Portfolio income from investments – interest and dividends – is taxed at 25%. Subject to certain conditions, a reduced rate of 15% is available for dividends paid by SME’s on shares issued as from 1 July 2013.

• Copyright income up to €57,080 received by individuals will not be treated as earned income even if it relates to a work activity and will only be subject to a final 15% withholding tax.


10.3 Estate duties


Estate duties vary depending on the location of the deceased’s domicile within Belgium. They are often quite high but, for certain classes of assets (including cash, art and most types of securities), taxes can be lawfully avoided by life-time gifts taxable at rates ranging from 3 to 7%, or even totally exempt.


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