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      Belgium – Key Personal Income Tax Measures in New Government's Coalition Agreement

      GMS Flash Alert 2025-059 | 20 March 2025

      Following the federal elections in June 2024, the formation of the new Belgian federal government, De Wever I, was finalised at the end of January 2025.  The tax policy choices and agreed measures of this government are detailed in the Federal Coalition Agreement 2025-2029.  This agreement includes tax reform aimed at enhancing the purchasing power of working individuals and boosting the competitiveness of the Belgian economy.1

      The coalition agreement outlines significant changes in tax legislation that will affect mobile employees and their employers in the coming years.  Below is a summary of the key tax measures related to personal income tax.

      WHY THIS MATTERS

      The coalition agreement outlines a number of measures that will impact individuals – including those on international assignments – and their employers.  The changes to the tax regime for inbound taxpayers and researchers will introduce greater flexibility and provide for more favourable terms.

      The cap to be introduced on social security contributions paid by employers will help employers to keep their employment-related tax costs down.

      However, taxpayers with certain unearned income will be subject to heavier taxation with the application of the so-called “solidarity contribution” on future unrealised gains.

      The impact on international assignment costs will depend on taxpayers’ circumstances and the terms of a company’s international assignment policy. 

      Tax Regime for Inbound Taxpayers and Researchers

      • The inbound expat regime (Bijzonder belastingstelsel voor ingekomen belastingplichtigen en ingekomen onderzoekers/Régime special d’imposition pour les contribuables impatriés) will be enhanced with a tax-free allowance of 35 percent (up from 30 percent), the removal of the €90,000 ceiling on that tax-free allowance, and a reduction in the minimum gross salary requirement to €70,000 (from €75,000) for inbound taxpayers.  (For prior covergage of this regime, see GMS Flash Alert 2023-020, 27 January 2023.)

      Capital Gains Tax

      • A new capital gains tax, termed the "solidarity contribution" (solidariteitsbijdrage/contribution de solidarité), will be introduced at a rate of 10 percent on future realised capital gains on financial assets, including crypto assets, accrued from the tax's introduction.  Historical capital gains are exempt.
      • Capital losses can be deducted within the year, without carryforward.
      • The first €10,000 of capital gains (subject to indexation) will be exempt.
      • For gains from entities with substantial participations of at least 20 percent, €1 million will be exempt. Capital gains between €1 million and €10 million will be taxed at specific progressive rates, while gains from €10 million and above will be taxed at 10 percent.

      Measures for International Mobile Employees

      • The Belgian tax and social security authorities will explore how to monitor the 183-day rule for income tax purposes using existing social security information.
      • Efforts will be made to reduce the administrative burden for frontier workers and collaborate with neighbouring countries to simplify their tax situation.

      Other Measures Relevant for Employers

      • A cap on employer social security contributions will be introduced at the salary level of Belgium’s prime minister.
      • No changes are planned for the tax regime on stock options and warrants.
      • A framework for tax-free employer costs will be established.
      • The value of meal vouchers will be increased, with more spending options available.  Other tax-favourable vouchers (e.g., eco vouchers, culture vouchers) will be phased out.
      • The existing collective bonus systems (CLA 90 bonus and profit premium) will be simplified and harmonised.

      Various Other Personal Income Tax Measures

      • A reduction in the tax burden on wages, leading to higher net wages from 2027, through an increased tax-free amount per taxpayer and a decreased special social security contribution.
      • Changes to the tax-free amount per child, with an identical amount per child and an overall ceiling.
      • Phasing out of the marital quotient for joint taxable couples (married/legal cohabitants) where one partner has little or no professional income.
      • Gradual reduction of the alimony payment deduction from 80 percent to 50 percent, with payments to beneficiaries outside the European Econoimic Area (EEA) no longer tax-deductible.
      • Elimination of the federal tax deduction for interest paid on loans other than for a primary residence (e.g., second homes or investment property).

      KPMG INSIGHTS

      These proposed measures require further elaboration and legislative enactment in the near future.

      If individual taxpayers and/or employers have questions or concerns about the measures highlighted in this newsletter, they should consult with their usual qualified tax professional or a member of the GMS/People Services team in Belgium (see the Contacts section).

      FOOTNOTE:

      1  (NL) See "Regeerakkoord van de federale regering Bart De Wever" (12 Februari 2025) at: https://www.belgium.be/nl/publicaties/regeerakkoord_van_de_federale_regering_bart_de_wever.

      (FR) See "Accord de gouvernement du gouvernement fédéral Bart De Wever" (12 février 2025) at: https://www.belgium.be/fr/publications/accord_de_gouvernement_du_gouvernement_federal_bart_de_wever.

      Contacts

      ilse-de-mesmaeker
      Ilse De Mesmaeker

      Senior Tax Manager

      KPMG in Belgium

      saadia-abdi
      Saâdia Abdi

      Director, Global Mobility Services

      KPMG in Belgium

      carolien-van-echelpoel
      Carolien Van Echelpoel

      Partner, KPMG Tax & Legal Advisers

      KPMG in Belgium

      Disclaimer

      The information contained in this newsletter was submitted by the KPMG International member firm in Belgium.

      GMS Flash Alert is a Global Mobility Services publication of the KPMG LLP Washington National Tax practice. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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