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Business and Taxation in Belgium

A company is founded by an incorporation deed of incorporation laying down all the defining features that will be included in its articles of association. At least two founders are needed to set up a regular company.

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The founders can be legal or natural persons, and neither has to be a citizen or resident of Belgium. If a founder lives abroad, his/her presence during the establishment of the company is not required – he/she can authorize third parties to establish the company on his/her behalf. However, if none of the founders  or directors is a local resident, there may be a complication with the compliance control of a bank where the capital is going to be paid to.

A company’s full share capital must be indicated when it is established. At least 30% of the capital must be paid, and the minimum to be paid is 6200 Euros (Minimum capital is 18,600 €).

Contributions in kind are also possible. They have to be evaluated by company auditors before the deed of incorporation is drawn up. A contribution to the capital must be confirmed by a legal document, usually a bank statement confirming a transfer of the called-up capital to the established company. These funds remain blocked until the notary submits a certificate to the bank, stating that the deed of incorporation has been passed and filed with the Tribunal Registry. The funds can then be released and made available to the company.

After the signing of the deed of incorporation, the notary proceeds with the registration of the deed and has an extract of it published in the Belgian Official Gazette (Moniteur Belge).

Ownership of the capital can be transferred by simply handing over the certificate (physical form). Physical transfer does not require any registration or publication and is, therefore, completely anonymous.

A company must have its legal address in Belgium, where all the company’s accounting books are kept. Shareholders can opt to define a notary’s office as the company’s legal address and thus avoid renting their own office.

The company’s employees can also be either Belgian or foreign nationals.

Belgium is an attractive country to do business. Among the main advantages of Belgium are the following:

  • Presence of one of the largest ports in Europe – Antwerp;
  • Location at the heart of Europe;
  • Status of Brussels as the capital of the EU;
  • Commercial and industrial hubs are concentrated in a small area within a 200 km radius;
  • Possibility to obtain a residence permit and a professional card making it possible to conduct business and professional activities;
  • High probability of being granted a bank loan for decades and at a low interest rate.

In Belgium, the four most common forms of legal entity are: public limited liability company (SA/NV), private limited liability company (SPRL/BVBA), one-person private limited liability company (SPRLU/EBVBA) and cooperative limited liability companies (SC/CV).

These forms of legal entity differ in terms of fiscal regime, status of shareholders who manage them, company rights and degree of responsibility. Most companies in Belgium are private limited liability companies (SPRL/BVBA). To establish such a company, a minimum of one shareholder (either legal or natural person) and at least two partners are required. The share capital of such a company must be at least 18,600 €, but it can have only € 6,200 in its bank account, and this money can easily can withdrawn.

The procedures of incorporation and obtaining a residence permit in Belgium can be divided into the following conventional steps.

The first step is to apply for a professional card and a residence permit. This can be done at the Embassy of Belgium in your country.

In accordance with Belgian law, since January 1, 1999 the person responsible for the daily management of a newly-established company is required to prove his/her knowledge of company management by producing a higher education diploma or relevant working experience. If you do not possess a recognizable diploma we will help you find a solution.

The first stage of a company’s establishment includes preparation of the articles of association and a business plan for at least two years, designation of future managers and opening of a bank account. Then the documents are passed to a notary who completes all the required formal procedures.

Once the first stage is done, you will have all the documents needed for the second one – registration of your company in the Trade Register.

The third step is obtaining a VAT number for your company.

The fourth step is joining a social security fund within 90 days of the date of the company’s establishment. By paying quarterly contributions to the fund you will be eligible for important social rights, i.e. family and invalidity benefits, pensions and bankruptcy insurance. For the first three years after the company’s registration you can pay a minimum contribution (at least € 685.99 per quarter). After that, the amount of the contribution will be recalculated on the basis of your real income. In addition to the social fund, you can join a health insurance fund to cover your medical expenses.

At the fifth stage, the company is formally registered at the relevant ministries. If the company’s activities are among activities regulated by the state, you must obtain the relevant permission.

If, on the top of that, if your company recruits staff, it must register with an organization regulating the employment status of employees (ONSS/RZV).

A business founder and his/her family members can obtain Belgian citizenship, provided legal requirements are met.

In Belgium, there are several types of tax.

Tax on individuals is one of the main types of tax; it is levied on all income earned by persons living in Belgium, for whom the country is a place of permanent residence or a place where the structures of their capital management are concentrated (place of main economic interests). Citizens whose names are entered in the state register are considered to be residents of the Kingdom, having permanent residence in this country. Double taxation may be avoided thanks to international conventions, however there are many particularities per type of income and of its origin.

You may also under certain conditions declare yourself a Belgian tax non-resident, which will limit your obligations towards the state. We can advise you on that.

Aggregate income of resident companies is subject to corporation tax. Companies are charged with several types of tax and contribution:

  • corporate income tax
  • capital gains tax levied on a donation
  • registration fee – 12.5%, which is also charged when buying real estate;
  • contributions to a social security fund
  • real estate tax depending on the cadastral (land registry) office;
  • tax on mergers and acquisitions, or liquidation tax;
  • value-added tax;
  • stamp duty.

Losses from previous years can be deducted without limit from future profits. In contrast to Germany, in Belgium the state will not reimburse losses incurred by corporations.

Social security contributions are deducted from the amount of taxable income, as are professional expenses incurred by the taxpayer in the process of earning income.

There are other expenses that reduce income tax. Among them, mortgage payments, personal insurance premiums, insurance in case of death with shrinking capital, acquisition of shares of one’s own company, etc.

To avoid an increase in the taxable amount, a taxpayer must pay at least one fourth of his/her tax before the due date. There are four such dates during the year.

For news and latest updates, visit our Facebook page Business Immigration to Belgium

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