Understanding corporation tax in Belgium – What you need to know

As an EU member state that benefits from the freedom of movement, it should come as no surprise that Belgium is home to up to an estimated 220,000 expats.

The number of expats in Belgium has increased by a whopping 46% since the year 2000, whilst a growing number of these individuals are operating their own commercial venture.


Whilst launching a viable and successful business in Belgium may be challenging, firms received some good news on July 26th 2017 when the Federal government announced that it would reduce its corporate tax as part of a widespread program of reform.

In this post, we’ll explore this decision in greater detail, before asking how you can take steps to understanding precisely how corporation tax works in Belgium.

The falling tax rate

The recent tax reform was built around three core pillars, namely budget neutrality, simplification and fairer rates for corporations nationwide.

In practical terms, the base corporate tax of 33.99% was lowered to 29% in 2018, whilst a further reduction to 25% is currently scheduled for 2020. In the case of SMEs that generate €100,000 or less per annum, the corporate rate tax rate fell to just 20% in 2018, whilst businesses that earn even less may also be eligible for further reductions going forward.

The so-called ‘crisis tax’ (which requires businesses to provide a nominal contribution to the government’s financial contingency) has also declined from 2% to just 1.5%, meaning that businesses across the board have continued to benefit from considerable tax breaks over the course of the last 12 months or more.

Interestingly, this tax reform was also supported by additional measures that were designed to stimulate job creation nationwide and increase the total investment in Belgium’s active economy.

These reforms have also been financed by some new budgetary measures, which came into force last autumn and capped public spending in targeted areas. This reflects a very considered and detailed economic plan, and one that will hopefully stand Belgium in good stead during a potentially challenging period.

Understanding corporation tax

Whilst these tax and economic reforms represent good news for businesses of all shapes and sizes in Belgium, it’s still important for companies to understand their financial responsibilities and factor these into their own financial planning.

As a business-owner in Belgium, one of the first things you should do is liaise with an established expert in taxation advisory services.

Firms like RSM offer a relevant case in point, as they can provide detailed VAT advisory services for their clients whilst also helping with the accurate completion of corporate tax returns. 

With this type of assistance, you can also seek out services that drive tax optimisation in Belgium, as you look for ways to legally minimise the amount payable to the government during each financial year.