Tax exemptions for Belgian residents working in UK

According to the UK/Belgian Tax Treaty, professional income earned by a Belgian resident from employment exercised in the UK and paid by, or on behalf of, an employer who is located there, shall only be taxable in the UK.

Belgian tax residents are taxable in Belgium on their worldwide income. Due to this, the UK earnings will still need to be reported in the Belgian tax return, but Belgium will apply the exemption (with progression) method to prevent double taxation.

Nevertheless, even if such income would be tax exempt in Belgium under the UK/Belgian Tax Treaty, the Belgian taxman applies an additional municipal tax (typically between 6 percent and 9 percent).

What few taxpayers know, is that such local surcharge can only be applied if it is explicitly stipulated in the Tax Treaty. With new tax treaties being negotiated and existing treaties being revised, the Belgian tax authorities started to include a specific provision to this effect.

Due to this, no additional municipal taxes should be levied on exempt UK-source professional income earned by Belgian tax residents in 2012. If you are a Belgian resident who earned professional income in the UK in 2012, it might be worthwhile to recheck the tax assessment you received in the mail.

Gregory Goossens / Expatica

Gregory Goossens is an attorney at TAXPATRIA, an independent service provider for the international community working and living in Belgium. Taxpatria is an alternative to the classic Big Four companies, and its aim is to establish a personal relationship with each client.

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