If you work in Belgium as a freelancer, self-employed worker or company owner, you must register to pay Belgian corporate tax and social security. This guide explains corporate tax rates in Belgium.
If you living in Belgium and working as a self-employed or freelance worker or company owner, you will be liable to file a Belgian tax return and pay income and corporate tax in Belgium. All self-employed workers must register with the tax office plus with a social security fund for the self-employed, and pay regular contributions.
The information below provides a general overview of Belgian corporate tax rates and conditions, however, you should always get professional advice from a Belgian accountant or financial professional when setting up your own business in Belgium.
Who has to pay Belgian income and corporate tax?
Companies, associations, bodies and establishments that are legal entities and have their registered office, main establishment, head office or administration office in Belgium, are required to pay Belgian corporate tax on any profit-making operations. Belgian corporate tax returns are submitted annually. Companies no longer receive a paper tax form but instead need to file their return electronically via the Biztax application.
If you are self-employed living in Belgium for more than six months (183 days) of the year and are registered with your local commune, then you are classed as a Belgian resident and have to pay Belgian income tax on your worldwide income. Your taxable income is the income left after deductions for social security contributions, professional costs and so on. If you are married, and your spouse’s income is less than 30% of your joint income, then you can also deduct a dependent spouse allowance.
If you live in Belgium for less than six months (183 days), and have no Belgian ID card, you will be classed as a non-resident and only be taxed on the income earned in Belgium.
Filing US taxes from Belgium
Despite the fact that every US citizen and Green Card holder is required to file a tax return with the IRS even when living abroad, many expatriates still fail to do so.
Many are unaware of these obligations, thinking that as an expat they do not need to pay or file tax returns in the US. You do! For more information and help filing your US tax returns from Belgium, contact Taxes for Expats and see our Guide to taxes for American expats.
Corporate tax rate in Belgium
The corporate tax rate in Belgium is currently 29%, with the addition of a surcharge tax of 2% (totalling 29.58%), although a lower Belgian corporate tax rate may be applied to companies that are more than 50% owned by individuals or with low taxable profit.
In 2021, the standard level of corporate tax will reduce to 25%, and the crisis tax will be abolished.
Companies typically make their Belgian corporate tax payments in four instalments:
- for the first quarter, no later than 10 April
- for the second quarter, no later than 10 July
- for the third quarter, no later than 10 October
- for the fourth quarter, no later than 20 December
To qualify for reduced Belgian corporate tax rates, a number of conditions must first be met. If approved, corporate tax rates in Belgium can be reduced to 20% (plus the 2% surcharge, totalling an effective rate of 20.40%) for the first €100,000 of profits.
Register to pay Belgian self-employment and corporate tax
You should register with the tax office and, if necessary, the VAT office – both of which can be done through a one-stop-shop or business counter (guichet d’entreprise in French, ondernemingsloket in Dutch). There are offices throughout Belgium. You can find the nearest office on the FPS portal. You will need to keep accounts, receipts and make declarations of income and pay your bills on time.
Paying Belgian corporate income tax
Whether you are a freelance or a sole trader, if you’re working in Belgium, you have to pay income tax (impôt des personnes physiques in French, personenbelasting in Dutch) every year. This tax is payable one year after the end of the tax year, although you can choose to pay advance estimated quarterly payments for the year in progress. You are not required to make advance payments for the first three years of setting up your business; after this period, you are required to do so.
If you are a sole trader or in a partnership, then your profits are subject to personal income tax. The current rates are progressive, up to 50%.
Income tax bands in Belgium:
- Up to €12,990: 25%
- €12,990–€22,290: 40%
- €22,290–€39,660: 45%
- €39,660+: 50%
The tax year runs from 1 January to 31 December.
You can pay tax by post to your local tax office (the address will be on the top of your tax return) or online using an eID through the Belgian government’s tax portal, Taxonweb.
If you are non-resident with a Belgian-earned income, then you have to inform your competent tax collectors office, who will send you a tax return every year. You can also pay by post or online.
Belgian VAT: Taxes on services and goods
In Belgium, VAT is called Taxe sur la Valeur Ajoutée (TVA) in French or Belasting over de Toegevoegde Waarde (BTW) in Dutch.
If your business is offering goods or services (with some exceptions: teachers, journalists, artists, doctors, and lawyers) then you may be liable to pay VAT – and charge your clients VAT, too. It is important that you keep accounts (an invoice book) and receipts. VAT is a flat rate of usually 21% and is paid monthly or quarterly.
If you pay VAT, you can reclaim VAT on your professional expenses. There is also a VAT threshold in Belgium; if your earnings are less than €15,000 you can opt for petite entreprise/kleine onderneming status, which makes you exempt from VAT but also from claiming it back. Small business can claim an exceptional VAT threshold up to €25,000.
VAT between EU member states
If you’re selling goods to another VAT-registered business elsewhere in the EU, the customer pays the VAT at the rate in their country, not you. You will need the customer’s VAT number; you can check this through the European Commission. If you buy goods from another country within the EU, then you pay the VAT at Belgian rates.
Since January 2015, businesses providing digital services (for example, e-books) to consumers in other EU countries have needed to pay VAT at the applicable rate and to the relevant authority in your customer’s country.
Social security and health insurance for self-employed in Belgium
Self-employed and freelancers generally pay a higher percentage of their income than employees, although the exact amount will depend on your age, how long you have been self-employed and how much you earn.
Self-employment social security contributions generally work out to around 22% of your annual income, rising to 14.16% when your income is greater than €54,398.06.
Contributions are based on your income from three years previously. During your first three years of working as a freelancer, you will be charged a minimum provisional amount and at the end of the three years your contributions will be adjusted – and you may have a shock. Avoid large bills by estimating what your income will be and making payments in advance.
You will be sent a bill at the beginning of each quarter (January, April, July, and October) and you have to pay before the end of the quarter.
Combining freelance with paid employment
If your freelance work is in addition to paid employment, you can apply for the status of indépendant complémentaire (in French) or zelfstandige in bijberoe (in Dutch), which allows you to pay social contributions as you earn with no minimum. Income tax is calculated by adding freelance income to your salary.
Professional card in Belgium
Foreign nationals who wish to be self-employed in Belgium will need a professional card, which confirms that you are authorised to exercise your profession in the country and forms part of your Belgian residency permit application. The professional card in Belgium aims to ensure that the economic, social and cultural interests of the country are respected, and are granted for one to five years.
Besides the exceptions, you must meet the following criteria to possess a professional card in Belgium:
- plan to carry out professional activity as a self-employed worker in the Belgian region you’ll be living/working in, either as a private individual, a representative of a company or association (paid or unpaid).
- not a Belgian national or a member of the EEA (European Economic Area).
If you live outside of Belgium, you can apply for a professional card by submitting your application form to a Belgian diplomatic mission or to a recognised business counter of your choice. A fee of €140 is charged per application.
Finding an accountant or financial expert in Belgium
You can find an accountant (expert-comptable or compte fiscal in French, accountant or belastingconsulent in Dutch) through the website of the Instituut van de Accountants en de Belastingconsulenten (French or Dutch only).
Belgian corporate tax authorities
- Federal Public Service Economy SMEs, Self-Employed and Energy: information on self-employment in Belgium, much of which is in English.
- Information on Belgian social security, mainly in French and Dutch, but has an English language contact email service.
- RSVZ: social security authority for self-employment in Belgium.
- VAT section of the FPS Finance website: more information on VAT, in French, Dutch and German.