Cross‑Border Tax Forecast 2026 in Belgium

The Belgian Council of Ministers of 18 July 2025 approved the preliminary draft law introducing a new tax on capital gains. The draft law is currently being debated in Parliament. The new capital gains tax is expected to enter into force retroactively on 1 January 2026.

The tax targets capital gains realised in the course of the normal management of private wealth when an investor carries out an onerous transfer of financial assets (e.g. shares, bonds, share ècertificates etc). These capital gains would be taxed at a rate of 10%.

An exemption is provided for gains accrued up to 31 December 2025 (‘historical assets’). For such assets, the taxable capital gain will be the positive difference between the amount received and their value as at 31 December 2025.

In addition to reducing the net return on investments, the main challenge lies in accurately determining the acquisition value in order to calculate the taxable gain.

It is important for taxpayers to be able to determine the value of their financial assets as of 31 December 2025. It is furthermore recommended that historical acquisition prices be rigorously documented in order to substantiate the taxable basis in the event of future disposals.

The Law of 18 July 2025 introduced a dedicated tax framework for carried interest, providing greater clarity on the tax treatment of these earnings within the investment fund industry.

The main goal of the new regime is to eliminate legal uncertainties surrounding the tax qualification of carried interest (movable income versus professional income), and to provide a competitive tax rate that aligns with neighbouring countries, thereby stimulating investment fund activities in Belgium.

Carried interest received by individuals (including foreign tax residents) will be classified as movable property income, subject to a flat tax rate of 25% (without possibility of requalification as professional income).

Despite clarification as to the appropriate classification, a major challenge remains in computing the taxable base due to the statute’s very broad definition of “carried interest”.

As the regime entered into force on 29 July 2025, financial sector actors must quickly adapt their processes for the calculation and payment of the withholding tax.

In July 2025, the reduced rate on dividends distributed by small companies was aligned at 15% for both the VVPRbis and the liquidation reserve regimes as from assessment year 2026. The Belgian federal government is now announcing that the rates for both regimes will be increased. These increases still need to be adopted by a tax bill that should be voted in the coming weeks.

The Belgian federal government plans to change the rates for both the VVPRbis and the liquidation reserve regimes from 15% to 18%.

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Management companies planning to distribute dividends should carefully monitor these legislative changes.

As from FY 2026, new conditions will be imposed in order to qualify for the reduced rate.

Small companies, like management companies, can benefit from a reduced CIT rate of 20% (instead of 25%) on the first EUR 100,000 of taxable profit provided certain conditions are satisfied. One condition pertains to the annual remuneration of the company director. As from FY 2026, the company director’s annual remuneration should be at least EUR 50,000 including benefits in kind (instead of EUR 45,000 as previously). Furthermore, as from FY 2026, the company director’s benefits in kind cannot exceed 20% of their total annual package.

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Following entry into force of the Programme Act of 18 July 2025, the Belgian tax penalty system has been fundamentally reshaped. The presumption of good faith is now the default rule.

• The 10% tax increase is no longer applied in the case of a first infringement committed in good faith
• Good faith is now legally presumed unless there are indications of bad faith or fraudulent intent
• Any decision rejecting good faith must be specifically reasoned by the tax authorities
• The benefit of the presumption applies only once every 5 years

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The draft law introducing mandatory electronic invoicing was approved by Parliament on 5 February 2026. This new requirement comes into force retroactively on 1 January 2026.

In B2B relationships, electronic invoicing is mandatory when all parties are established in Belgium.

After two months of using the e-invoicing system, we have noticed a few flaws, particularly for taxpayers who have to issue or receive a high volume of invoices. The software sometimes has bugs, such as invoices not being sent or received. It is therefore necessary to exercise caution. The VAT authorities are allowing a period of adjustment and have relaxed their penalty policy accordingly. Nevertheless, it is important to check in practice.

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Two important 2025 updates:

• Financial asset condition
• DRD is offsettable against a received intra-group transfer

The DRD regime is the transposition in Belgian tax law of the parent-subsidiary directive. However the scope of the Belgian DRD regime is broader than the EU directive insofar as it foresees an alternative minimal participation condition of EUR 2.5 million when the 10% participation threshold is not met.

• Financial asset condition: the tax bill dated 18 July 2025 foresees that, as from assessment year 2026, for all Belgian companies (that are not small companies within the meaning of the Belgian Company Code), the DRD regime will be applicable only if participation is booked as a financial asset in the company’s balance sheet. This measure targets companies that have a participation of less than 10% in another entity but for which the investment value is at least EUR 2.5 million.
• DRD is offsettable against a received yearly intra-group transfer: as from assessment year 2026, the yearly DRD can be offset against a yearly intra-group transfer received by a taxpayer (tax consolidation regime). 
  This update follows ECJ case-law C-135/24 (John Cockerill SA vs Belgium) that considered the Belgian DRD regime contrary to the parent-subsidiary directive insofar as dividends could not be offset against a received yearly intra-group transfer.
  This legislative update is welcome and puts an end to a clear violation by Belgium of the parent-subsidiary directive.

The Belgian tax authorities released a circular in October 2025 (circular 2025/C/63) on how to interpret the notion of ‘financial asset’ in BEGAAP (Belgian Generally Accepted Accounting Principles) and its practical implication for the DRD regime. There is currently legal uncertainty as to how to precisely interpret the concept of ‘financial asset’. We can anticipate tough discussions with Belgian tax authorities in the framework of future tax audits.

Holding companies having participations of lesss than 10% but for which the investment value is at least EUR 2.5 million should carefully review their investment portfolio and determine whether these assets will qualify as financial assets.