On Tuesday, 17 May 2022 our update on the new Belgian expatriate tax regime took place.
The previous expatriate tax regime was withdrawn and replaced by a new regime. The law was voted in parliament on 23 December 2021 and the new Belgian expatriate tax regime entered into force on 1 January 2022.
With the publication of the long-awaited Circular Letter, the tax authorities provided more clarity on the conditions and possibilities to benefit from this new regime.
Our experts, Ferdy Foubert and Carolien Van Echelpoel, walked you through the practical implications of the new expatriate tax regime and the actions to take.
Key takeaways
Entry into force
As of 1 January 2022
Conditions for the individual
- Employee or Director (involved in daily management)
- Directly recruited abroad or assigned to Belgium
- In 60 months, preceding start of employment in Belgium
- Not have been considered a Belgian resident taxpayer
- Not have resided less than 150 km from the Belgian border
- No taxable employment income as a non-resident
- Minimum remuneration of 75.000 EUR per annum (not required for Inbound Researchers)
- Limited in time up to 8 years (5 + 3)
- Belgian nationals can qualify
Conditions for the employer
- Directly hired from abroad by
- A Belgian company
- A Belgian establishment of a foreign company
- A Belgian or international non-profit association (Article 1/6 § 2 of the company law (ASBL-VZW - AISBL IVZW))
- Seconded by a foreign company, part of a multinational group, to
- A Belgian company
- A Belgian establishment of a foreign company that is part of a multinational group
- A Belgian or international non-profit association (Article 1/6 § 2 of the company law (ASBL-VZW - AISBL IVZW))
Benefits
- Normal residency rules apply
- Cost proper to the employer (related to employment in Belgium)
- On top of the remuneration
- Exempted from personal income taxes and Belgian social security contributions
- Limited to 30% of the gross remuneration
- Capped at 90.000 EUR per year
- Tax-free payment or reimbursement by employer of certain non-recurring expenses related to moving, first installation and school fees
Formalities
- Employer will need to file an application within 3 months following start of activities in Belgium
- A new application needs to be filed if employment in Belgium is continued after expiration of initial 5 years
- The employer needs to submit an annual listing of individuals benefiting from the regime by 31 January of the year following the income year
Transitional measures
- New hires as from 1/1/2022 can only benefit from the new regime
- Individuals benefiting from the old regime and less than 5 years in Belgium on 1/1/2022 can opt to switch to the new regime.
- To opt-in for the new regime, an application needs to be filed by 30/9/2022
- Conditions need to be met at the start of the activities in Belgium
- Annual salary threshold needs to be met throughout the employment in Belgium
- If application for new regime is denied, it is possible to continue under the old regime up to 31/12/2023 provided the condition for the old regime remain fulfilled
- Individuals benefiting from the old regime and more than 5 years in Belgium on 1/1/2022 can remain under the old regime up to 31/12/2023 at the latest (provided conditions to benefit from the old regime remain fulfilled)
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