As 2019 comes to an end it is time to look back which relevant changes came across in 2019 in the field of (international) social security. At the same time, we look forward to the opportunities and challenges which will continue in 2020.

Notion of salary subject to social security

As from July 2018 already, the Belgian social security authorities modified their interpretation on the definition on salary subject to social security in their instructions to the employers. This change in definition was following a court decision of 2018. The new position of the authorities now states that social security contributions are due on all benefits which are paid or granted for labour in the framework of the employment agreement concluded with the employer or which are related to the function which the employee executes with this employer. This is irrespective of the fact whether the (Belgian) employer is actually paying / granting the benefit and/or irrespective of the fact whether the (Belgian) employer is the legal contact point.

Olivier Vanneste, Director Global Mobility Services, KPMG in Belgium

Partner, Head of People Services | Tax, Legal & Accountancy

KPMG in Belgium


The court decision was challenged before the Belgian Supreme Court which has provided a judgement on 20 May 2019. In its judgement, the Supreme Court confirmed that the benefits which an employee receives as the counterpart for the work agreed between employer and employee are subject to Belgian social security irrespective whether the benefit is (legally or economically) at charge of the employer.

The above can have an important impact on the social security treatment of equity granted by the mother company to the employees of the Belgian company of the group.

In view of these new developments, it is important to make a detailed analysis of the conditions for the grant of the benefit, the way the benefit is paid and whether it is directly or indirectly at charge of the employer. The Supreme Court has not yet clearly settled the discussion on whether the authorities’ adjusted interpretation is fully compliant with Belgian legislation. Nonetheless, the discussion is settled at one point: if the benefits are granted as counterpart of the work agreed between employee and employer, social security contributions are due on this benefit.

Requalifying cross-border activities for social security

At the end of 2018 and the beginning of 2019, an important change in the position taken by the Belgian social security authorities was announced with regard to the qualification of activities in a cross-border context.  This change applies when Belgium is identified as the competent country on the basis of the social security coordination rules in EC Regulation 883/04, applicable to the member states of the European Economic Area and Switzerland.

Following the principle of equality of treatment as stipulated in the EC Regulation 883/04, in cases of multi-state employment, Belgium now re-evaluates a person’s social security status according to its own national legislation in order to determine the applicable Belgian social security regime.  Previously, the Belgian authorities kept the qualification given by the country where the activity was performed.

Over the past months there have been questions on the practical implications of this new approach.  Only recently has clarification been given by the Belgian social security authorities. Instructions were provided on the start date of this new position, the payment (or reimbursement) of social security contributions, and relating benefits and the effect on the procedure for the request for certificates of coverage (A1 documents).

It has been clarified that application of this new approach is mandatory as from 1 October 2018.  For situations that started in 2018, there is a possibility to voluntarily “regularize” the situation as from 1 January 2018.

This retroactive start date practically means that companies should (re-)assess the social security regime of their personnel who are subject to Belgian social security and who have a corporate mandate abroad.  It is advisable that these companies inform the concerned individuals about their responsibility to affiliate themselves, possibly retroactively, to the Belgian social security regime for self-employed persons, and to pay the contributions for their director’s activities.  Social security contributions that were paid in the Belgian social security regime for employed persons can be reimbursed to the company.  Affiliation to the Belgian social security regime for self-employed persons may have a cost-saving effect for the company and/or individual, because no employer social security contributions are due and the social security contributions in this regime are capped.

To request a certificate of coverage (A1 document), a specific questionnaire must be completed.  For the foreign company director mandates, supporting documents (e.g., the statutes of incorporation of the company) must be provided to enable the Belgian social security authorities to qualify the foreign activity correctly.  The A1 document will eventually refer to the qualification given in the member state of work.  There might thus be a discrepancy between the qualification of the corporate activities on the A1 (since qualified as employed activity in the country of work) and the actual applicable social security scheme in Belgium (self-employed person).

There are still a few topics pending resolution, including which (self-employed) activities other than corporate mandates are covered, whether the Belgian social security authorities will requalify these if they appear to be a self-employed activity abroad, and how the Belgian authorities will assess these (specific) types of activities.

Moreover, the Belgian social security authorities are the first to taken an official position on this. It remains to be seen if other countries will take a similar view. In case of conflicting interpretations, it will ultimately be up to the European Court of Justice to take a final decision.

Together with you, we are looking forward to further developments in this respect.