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VAT Registration Belgium
Updated on Wednesday 09th November 2022 Rate this article
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Value added tax (VAT) is an indirect tax in Belgium with a standard rate of 21% for certain goods and services commercialized on the Belgian territory.
Investors who are interested in opening a company in Belgium should know that the government also applies reduced VAT rates for certain categories of products and services.
Our company formation agents can provide you with further information on the VAT available in Belgium, but also on the VAT registration, compulsory for all businesses set up here.
In order to open a company in Belgium in 2022, investors are required to follow a number of steps, one of them being the VAT registration. However, this step does not take place before other relevant ones that have to do with the actual registration of the new business with the Belgian commercial register.
Investors who need assistance with this step, as well as any other ones during the incorporation process, can reach out to our agents.
| Quick Facts | |
|---|---|
| We offer VAT registrationservices | yes |
| Standard rate | 21% |
| Lower rates | 0%, 6%, 12% |
| Who needs VAT registration | All companies engaged in activities subject to VAT, before the commencement of such activities |
| Time frame for registration | Approximately 4 weeks |
| VAT for real estate transactions | The purchase of new real estate can be subject to the 21% VAT rate; exemptions apply |
| Exemptions available | A VAT exemption scheme applies to small businesses in Belgium with an annual turnover of less than EUR 25,000 |
| Period for filing | Monthly or quarterly |
| VAT returns support | Upon request |
| VAT refund | VAT deductions are available for most categories of business purchases; Certain categories of expenses do not qualify for a VAT refund (such as the supply and intra-Community acquisition of tobacco and alcoholic products). |
| Local tax agent required | Advisable |
| Who collects the VAT | Federal Public Service Finance |
| Documents for VAT registration | Registration form Company documents Proof of VAT-related activities Power of attorney if submitting the registration through a representative |
| VAT number format | BE + 8 digits + 2 check digits |
| VAT de-registration situations | When the company ceases its activities |
According to the Belgian tax law, a taxable individual for VAT purposes is a natural or legal person that:
- - exercises an economic activity;
- - in an independent and habitual manner;
- - as the main activity or a secondary activity;
- - for the purpose of delivering goods or services covered by the VAT code and regardless of the economic activity that takes place for the actual provision of these goods and services.
Companies that are registered in Belgium are registered for VAT purposes after their formal registration for business purposes (this step is detailed below by our agents).
Non-resident companies, those that are domiciled or registered in another country may also be liable for VAT under Belgian law – this is not determined based on where the economic activity takes place, but on the goods and services that are being offered.
One of our agents who specialize in company formation in Belgium can provide more details about the laws in force and about how VAT registration in Belgium in 2022 takes place for a non-resident legal entity.
Belgian VAT registration for a foreign company
Any foreign company with operations on the territory of Belgium must file for VAT registration and for VAT return when it carries out transactions that are subject tot his tax or for the purpose of deducting VAT.
For VAT regulatory purposes, a foreign company is a legal entity that does not have a permanent establishment in Belgium and whose registered office, or domicile, is located in another country.
Registration for VAT purposes is possible in the following ways:
- - with the local VAT administration office, as soon as the company has recorded the transaction that is subject to this tax, or before the commencement of the activities if it is certain that these will be subject to VAT;
- - via the One Stop Shop, a type of business office that can be found in various locations around the country and allows businesses to perform a set of mandatory registrations and activities.
Our team of company formation agents in Belgium can assist foreign companies that wish to know more about the conditions for VAT registration in the country, as well as using the One Stop Shop.
Foreign companies that have to file for VAT returns qualify for the special measures imposed by the European Union, under Article 194 of the VAT Directive.
As such, non-resident suppliers providing supplies of goods must file for a reverse charge if the customer to whom the goods are being sold is a resident tax payer in Belgium who has filed for VAT return; the customer can also be a non-resident paying tax in Belgium who owns a VAT number. The same rule is applicable for the supply of services.
The yearly statement filed by foreign companies in Belgium includes information about the taxable goods and services they have provided along with information about the VAT persons identified for tax purposes.
The statement is filed electronically by the end of March (the 30th of March) the next calendar year. Our agents who specialize in company registration in Belgium can provide more details on this process.
Foreign companies should keep in mind that a Member State might require additional information on all the transactions in which a company engaged in the previous year. This statement will need to contain details that will allow any adjustments to be made (applicable to foreign companies that provide goods and services both in Belgium and in another Member State).
Foreign businesses can rely on the services provided by our team and appoint one of our agents to essentially act on their behalf, as a tax agent would, when handling the VAT registration.
This is possible via a special appointment through a power of attorney and we can provide more details upon request about the needed documents.
Like a locally registered company, a foreign company registered for VAT in Belgium is subject to the following when carrying out activities that are not subject to a VAT exemption (as per Article 44 of the VAT Code):
- - identify the VAT obligations that arise, before the start of the activities;
- - submit the VAT statements;
- - return the invoiced VAT to the customers;
- - file the annual client listing;
- - hold proper accounts and issue proper invoices.
You can read more about these general requirements for VAT taxable entities below.
VAT registration in Belgium for local companies
Locally registered companies need to register for VAT purposes if their activities are subject to VAT.
A company, both local and foreign, is subject to this tax if it provides goods or services as they are listed in the VAT code.
This tax obligation arises whenever the economic transaction/activity that is subject to VAT takes place.
When a company, local or foreign, only carries out activities that are VAT exempt (for example, certain activities in the medical field, financial operations, certain cultural activities), it does not need to register.
A company carrying out only VAT exempt activities will, understandably, not have the right to deduct VAT.
Obtaining the VAT in Belgium is subject to the following four steps:
- Company registration: before registering for VAT purposes, the company needs to be registered with the Crossroads Bank for Enterprises (Banque-Carrefour des Entreprises - BCE)
- Form filling: the company is then required to fill in form 604A and submit it to the competent authorities.
- Examination: the form is examined by the authorities and once this is complete, the business number that has been attributed by the BCE is also approved as a VAT identification number.
- Notice: the authorities communicate the VAT registration result to the taxable company or individual via a formal letter.
All companies that provide goods and services that are subject to the value-added tax are required to file Form 604A. Under the law, there are also exempt taxable persons as well as occasional taxable persons.
Form 604A is available at the approved business registration counters, with the competent Belgian service and online on the Service Public Federal Finances.
It is important to note that this form needs to be filled in and submitted before the commencement of the economic activities and after the company has obtained its business registration number from the Crossroads Bank for Enterprises.
Failure to submit this form is subject to a penalty of 500 euros. Late filing is subject to a 100 euros fine and the incorrect filing of the form is subject to fines according to their type (80 euros for accidental ones and 300 euros for other irregularities). Failure to observe the steps for the filing procedure is also subject to a fine of 200 euros.
One of our agents who specialize in company formation in Belgium can provide more details on the procedure of filing form 604A with the competent authorities and can assist you in the process of VAT registration in Belgium.
VAT rates in Beligium in 2022
Below, we present the VAT rates in Belgium:
- • 21%: this is the standard value-added tax, applicable to a wide range of goods and services
- • 12%: applied to foodstuffs, agricultural products, social housing, catering industry and several minerals used as energy products;
- • 6%: applied to foodstuffs, water, medicaments, medical equipment designed for persons with physical disabilities, transportation (for passengers), books and cultural events; our company formation specialists can provide you with a detailed list of services and products in this category;
- • 0% for daily and weekly publications and some recycled goods.
VAT returns in Belgium
The VAT returns must be completed by your company on a monthly basis; you can also opt for a quarterly basis VAT returns, but only under certain conditions.
The credit balance is carried out automatically into the next reporting period under the following circumstances:
- - the taxable person has not expressly required the return of the balance;
- - the request of the VAT return has been expressed but the legal or natural person does not meet the reimbursement conditions;
- - an account number has not been provided to the authorities.
The minimum credit balances are as follows:
- - for the 1st, 2nd and 3rd quarter the minimum is 615 euros;
- - for the 4th quarter of the taxable year, the minimum is 245 euros.
The reimbursement is to take place no later than June 30 for the 1s quarter statement and September 30 for the 2nd quarter. Companies that are subject to extensions to the filling dates can expect their reimbursement for the second quarter to be delayed.
No VAT deductions apply to the purchase of investment property. When the property is used in the context of the company’s taxable activity, then it can VAT can be deducted as per usual. The deduction of VAT for the costs related to the improvement of the investment property is subject to a revision.
One of our agents who specialize in VAT in Belgium can provide detailed information on the VAT return forms.
We invite you to watch the following video on VAT registration requirements:
Late VAT payments for Belgian companies
In some cases, investors who open a company in Belgium may be eligible for a VAT payment program, however, a number of important conditions apply in this case. Small companies or any other types of companies that are facing financial difficulties can set up a payment plan if they can anticipate that they will not be able to make the VAT payment on time. Please note that this is not the same as incurring debts and cannot be used for an account (for a company) that already had VAT payment debts.
A company that has had no history of past ill payments can pay the debt within four months after the usual date. The following conditions are important:
- - the request must be lodged with the Belgian FPS Finance on time, no later than the due date for the debt;
- - the company must have had no other debts with the tax authorities;
- - both businesses and self-employed individuals who request this must be in good standing with the obligations that arise for tax payments and submissions.
Companies are not required to meet all of these conditions in order to be accepted for the payment plan. For example, when one of these is not met, further evaluation of the company’s compliance status will be taken into consideration.
Companies that have additional debts with other companies, as well as those that cannot pay within the four months granted by this method, will not be accepted for the payment plan. Moreover, those companies that have lodged their request after the debt due date will not be taken into consideration.
Each company is evaluated separately and its particular history, as well as characteristics and financial situation, are carefully taken into consideration. The authorities will analyze the company’s ability to make the payment given the extension period, according to the real income of the business and an estimate for the fixed expenses.
Another issue that will be taken into consideration will be the company’s ability to make the payment in a given period of time, which under no circumstances may be longer than 12 months.
Companies that are in financial difficulties can take this option into consideration, however, those that are under liquidation or corporate restructuring can reach out to our team of Belgian company formation specialists for more information on how these plans can be used.
VAT regimes for small companies
Companies are required to pay VAT and submit the monthly statements, however, this is not mandatory for companies that do not exceed a certain annual turnover.
- • the tax exemption scheme: for small businesses with an annual turnover of no more than 25,000 euros. the flat-rate regime: for companies with an annual turnover of fewer than 750,000 euros that operate in certain sectors.
- • the agricultural regime: the farmer benefits from exemptions from most of the obligations that arise under the normal regime; there is no need to file the VAT statements and does not pay VAT (thus he cannot deduct it).
- • the margin tax system: applicable to works of art, collectibles, antiques or second-hand goods.
The schemes described above are optional and business owners may decide if these suit their needs, particularly if they activate in the sectors targeted by these regimes, like agriculture.
Please note that it is recommended to reach out to one of our agents who specialize in company formation in Belgium in order to determine if one of these regimes can apply for your business.
All companies in Belgium should know that special VAT controls can take place. The access of VAT controllers within a company’s premises is to be granted at any time (except for premises that are inhabited) and without prior working. Upon their arrival the VAT inspectors will present their motive for the inspection upon request. The inspector may seize books and accounting documents if he so sees fit. Electronic documents may be downloaded and copied by the inspector.
Other taxes for companies in Belgium
These include the following:
- - 25% corporate income tax rate;
- - standard 20% dividend withholding tax on dividend payments made to residents and non-residents; can be reduced under a double taxation agreement;
- - 30.57% base employer contribution of 1.08 times the gross salary of blue-collar employees and 25% of the gross salary for white-collar employees (can depend on the industry in which the company activates);
- - payroll tax, real property tax, transfer tax and stamp duty, among others.
The corporate income tax is subject to prepayment, and this is done on a quarterly basis. Advance payments are due at different points after the first, second and third quarters and before the end of the financial year. When the prepayments cause an overpayment of the corporate income tax, the authorities will make a refund as needed.
Other issues concerning taxation worth mentioning to investors are the following:
- - Belgium has an extensive double tax treaty network, with more than 90 such treaties in force;
- - Tax compliance and reporting for taxes other than VAT is performed on a yearly basis and the annual tax return is to be filed no later than the last day of the seventh month after the end of the financial year;
- - The tax year is the accounting year, equivalent to the calendar year or another chosen 12-month period;
- - Newly incorporated companies can have a shorter or linger accounting years. The annual tax return is based on the approved financial statements;
- - The main sources for the rules on accounting are the Belgian GAAP and IFRS.
The corporate income tax mentioned above also applies to branches in Belgium.
For foreign companies with permanent establishments in the country, the taxation and reporting rules apply much in the same way, however, certain differences can be in place.
Our team can provide both incorporation assistance as well as tax counsel, irrespective of the type of company you choose to incorporate.
If you need further details on the VAT legislation applicable in Belgium, please contact our company formation representatives, who can offer assistance according to your business plan and can help you in the process of VAT registration in Belgium.
Meet us in Antwerp
Karel Mul is a Doctor of Laws and Master of Roman Notarial Law (Ghent University). He is an experienced corporate lawyer and an active member of numerous international organizations. He will help you establish your company in Belgium and assist you in all business related issues you may encounter.
Call us now at (+32) (0)3 2373426 to set up an appointment with our consultants in Antwerp , Belgium. Alternatively you can incorporate your company without traveling to Belgium.
As our client, you will beneficiate from the joint expertize of local lawyers and international consultants. Together we will be able to offer you the specialized help you require for your business start-up in Belgium.
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