Author: Jordan Vannerom

Capital Gains Tax on Financial Assets: FPS Finance Unveils Its Interpretation of the Reform

Several months after the entry into force of the new capital gains tax on financial assets, the Belgian Federal Public Service Finance (FPS Finance) published Circular No. 2026/C/74 of 22 July 2026.

With more than 100 pages of commentary and examples, this is the first comprehensive administrative position on the reform. While the Act of 6 April 2026 established the legal framework, the Circular now clarifies how the tax authorities intend to interpret and apply these new rules.

For investors, entrepreneurs and their advisers, this administrative guidance is essential reading. 

But which clarifications truly deserve your attention?

Practice now complements the law

The circular does more than restate the statutory provisions. It provides practical clarification on several key concepts, illustrates their application through numerous examples, and establishes the reference framework on which the tax authorities will rely during future tax audits.

Coexistence with the general regime for miscellaneous income

The circular begins by confirming that the new tax coexists with the existing miscellaneous income regime: any transaction exceeding the scope of normal private asset management or considered speculative remains taxable at 33% under Article 90, 1° of the Belgian Income Tax Code 1992 (ITC 92). The taxpayer is the owner or bare owner of the transferred assets, never the usufructuary—a distinction that is particularly significant in estate planning.

A particularly broad definition of financial assets

The circular confirms that the concept of “financial assets” is not limited to shares and bonds. It also includes ETFs, ETNs, crypto-assets, units in collective investment undertakings, and interests in simple partnerships. Conversely, certain payment instruments remain outside the scope of the regime.

This clarification confirms that the reform extends far beyond traditional investment portfolios.

Examples of internal capital gains

The circular sheds light on this issue by describing several practical cases and examples. For instance, where parents sell the shares of their company to a holding company owned by their children, in which the parents themselves are not shareholders, the specific regime does not apply. However, if the parents subsequently transfer the balance of their current account to their children, the tax authorities may recharacterise the transaction as an internal capital gain under the general anti-abuse provision of Article 344, §1 ITC 92. Conversely, where a private equity fund exercises joint control, Article 90, 9°, a) does not apply because the shareholder no longer exercises control “alone or together with close family members.”

Substantial Shareholdings: Long-Awaited Clarifications

FPS Finance also provides several important clarifications regarding the regime applicable to substantial shareholdings.

In particular, the Circular confirms that the 20% threshold is assessed solely at the level of the transferor, irrespective of the shareholdings held by family members. It also clarifies that profit certificates, options and warrants are not taken into account when determining this threshold, and illustrates various situations involving usufruct, bare ownership and successive transfers.

These examples will help provide greater legal certainty for transactions involving family-owned businesses.

The EUR 1 million exemption: a mechanism finally illustrated

Another particularly useful point concerns the operation of the EUR 1 million exemption applicable to substantial shareholdings.

The circular confirms that this exemption operates as a genuine “backpack” mechanism: the available exemption amount is assessed over a rolling period of five taxable periods and is gradually restored over time. Several numerical examples finally make its practical implications easier to understand.

For shareholders considering a disposal, these clarifications could influence the timing of certain transactions.

Reporting obligation: key koints and clarifications

For internal capital gains and substantial shareholdings, withholding tax is not collected by intermediaries, as they are not in a position to determine the amount of the capital gain or correctly withhold the tax. The tax is therefore assessed through the taxpayer’s income tax return.

For this reason, the legislation introduced a reporting obligation for intermediaries involved in such transactions. This obligation enables the tax authorities to verify whether any capital gain has been properly declared. Since intermediaries are not always able to determine whether a transaction actually gives rise to a taxable capital gain, the reporting obligation is linked to the transaction itself. Reporting becomes mandatory as soon as the transaction has been effectively executed.

The circular provides numerous clarifications, including the timing of the reporting obligation, the meaning of the term “person involved,” the required connection with Belgium, situations involving multiple intermediaries, the interaction with professional secrecy, and the content of the report itself.

Exit Tax: particular attention to departures from Belgium

The Circular also devotes particular attention to the new exit tax mechanism. It specifies the situations in which a transfer of tax residence outside Belgium may trigger taxation of unrealised capital gains on certain financial assets, while also clarifying the calculation methods and the deferral mechanisms provided for by law.

 

At a time when the international mobility of entrepreneurs and investors continues to increase, these clarifications highlight the importance of anticipating the tax consequences of a change of tax residence.

What this means for you

The publication of Circular No. 2026/C/74 marks a new milestone in the implementation of the reform.

If you are an investor, entrepreneur or business executive, this circular is a valuable tool to help anticipate the tax consequences of your transactions, secure your decisions and reduce the risks associated with future tax audits.

At Tax Consult, we closely monitor these developments in order to assist you in analysing your investments, restructurings and succession planning projects in light of this new administrative guidance.

Are you wondering how this reform may affect your situation? Do not hesitate to contact our team. We would be delighted to discuss it with you.

E-invoicing update – are you ready for 2026?

E-invoicing as the new norm

On January 1, 2026, structured electronic invoicing will become the norm in Belgium for transactions between regulated companies.

The objective of electronic invoicing is twofold:

  • On the one hand, to reduce the VAT gap, i.e., the difference between the VAT revenue the state should receive and what it actually collects;
  • On the other hand, to pursue a deep administrative simplification for both taxpayers and the state.

The transition period offered to the concerned taxable person aims to ensure that everyone has the opportunity to adapt to this new invoicing method.

Starting from January 1, 2026, all transactions carried out in a B2B context (service provisions or goods deliveries between businesses) and subject to VAT in Belgium will fall under the new electronic invoicing method. In other words, this obligation will not apply to B2C transactions (operations between a business and an individual).

Notably, taxable persons exempt under Article 44 of the VAT Code, foreign taxable persons (even if they are VAT-registered in Belgium), or taxable persons in bankruptcy will not be required to issue electronic invoices.

The same applies when the client is an exempt taxable person (under Article 44 of the VAT Code). In this case, as with individual customers or non-VAT-registered customers, the supplier will not be subject to these new regulations.

Additionally, transactions classified as B2G (Business-to-Government) are already governed by specific European regulations in this area (since March 1, 2024).

But what does "electronic invoicing" mean?

The new definition of this concept was introduced by the European Commission’s ViDA proposal and adopted by Belgium. A structured electronic invoice is an “invoice that is issued, transmitted, and received in a structured electronic format that allows for automatic and electronic processing.”

As a result, invoices issued in PDF format are not considered structured electronic invoices!

The authenticity of the origin, the integrity of the content, and the readability of an invoice must always be ensured from the moment it is issued until the end of its retention period. The rules regarding this requirement remain unchanged.

Furthermore, a structured electronic invoice can be issued by:

  • The supplier itself;
  • A third party (in the name and on behalf of the supplier);
  • The customer in the case of self-billing, if there is a prior agreement between the parties.

The PEPPOL network

To issue and receive electronic invoices, Belgium has chosen the PEPPOL BIS format, which defines the key elements of an invoice. It also recommends that electronic invoices be sent via the European PEPPOL network. “Pan-European Public Procurement On-Line” is an open network that enables taxable persons to send, receive, and process electronic invoices efficiently.

By joining this network, businesses and other organizations can easily and securely exchange invoices in a fast and efficient manner. The affected taxable persons can access the network through a single connection to a PEPPOL access point. This network is already in use in many member states.

However, taxpayers may, by mutual agreement, opt out of using the PEPPOL BIS format for invoices and choose an alternative system. In such cases, invoices must still comply with the European standard EN16931 to ensure harmonization.

Don't wait until it's too late

Electronic invoicing is driving businesses toward digital transformation. It is essential for companies to prepare as soon as possible for these changes.

That’s why it’s essential to begin this transition as soon as possible. Don’t wait until 2026, get ready now!

Our teams are at your disposal to answer any questions you may have on the subject, including legislative aspects, accounting tools and tax incentives.

Are you a MNE subject to Pillar 2?

What is it about?

Multinational enterprise groups (MNE Groups) subject to Pillar 2, introduced by the law of 19 December 2023, are now subject to a new mandatory notification requirement. MNE Groups must now be registered with the Crossroads Bank for Enterprises (CBE) separately, meaning that a specific number will be attributed to the group. This registration will be different from the specific Belgian entities’ numbers. 

When does it need to be filed?

This specific registration obligation has been organized by the Royal Decree of 15 May 2024 and the notification must be filed with the Belgian Tax Authorities by one of the following dates, whichever is the latest:

  • Within 30 days following the start of the financial reporting year for which the MNE group enters the scope of Pillar 2;
  • Within 45 days following the publication of the Royal Decree of 15 May 2024 in the Moniteur belge / Belgische Staatsblad. The Royal Decree having been published on 29 May 2024, it means that, as for the current period, this date is set for the 13 July 2024.

Who must do that?

The notification must be made:

  • Where a single ultimate parent entity is established in Belgium: by that single ultimate parent entity;
  • Where several ultimate parent entities are established in Belgium: by the ultimate parent entity designated as the authorized representative;
  • Where there is no ultimate parent entity, and only one constituent entity is established in Belgium: by that single constituent entity;
  • Where there is no ultimate parent entity, and several constituent entities are established in Belgium: by the constituent entity designated as authorized representative.

Please also note that MNE Groups having chosen to opt in for the safe harbor rules must also comply to this registration obligation.

What should be gathered?

If you fall within the requirements of this decree, rather extensive information must be gathered and communicated to the tax authorities such as:

  • General group information, such as group name, fiscal year, address etc.;
  • Information on the type of consolidated financial statements;
  • Detailed information on the ownership structure, including the entities that are (an) ultimate parent entity/ies (UPE), intermediate parent entity/ies (IPE), partially-owned parent entity/ies (POPE) and their subsidiaries;
  • Information on the group point of contact.

If the notification form mentions all necessary information, the FPS Finance will register the MNE group with the CBE. The group’s company number will then be sent by e-mail to the entity that notified the group.

It is essential that you comply with those new tax regulations and that you gather the right information to submit your notification form before it’s too late.

Did you know you have to submit your rent as a professional expense for tax deduction?

Tax deduction for rents

A professional expense?

What is it about?

The law of 28 December 2023 (on various tax provisions) introduced a new reporting requirement for tenants who wish to deduct their rent as a professional expense and tightened the conditions for deductibility of the latter.

Two issues appeared

On one hand, the tax authorities apparently had difficulties detecting cases where tenants used the property for their profession. On the other hand, landlords sometimes were deceived by their tenants.

It was indeed not inconceivable for a tenant to use the property for their professional
activity and deduct (even partially) the rent as a professional expense – without the
tenant being aware of it and even though the lease contract prohibited it – resulting in
heavier taxation for the landlord.

Consequently, the landlord was then taxed based on the actual rents received and no
longer on the indexed cadastral income, increased by 40%.

The landlord then had no choice but to file a legal recourse to recover the additional tax
burden due to the tenant’s fault. A procedure often tedious and laborious, which was
anything but beneficial for the relationship between the tenant and the landlord, and
which did not prevent the tax from being due in the meantime.

Watch out for the prohibition of deduction!

If this new declaration is not respected, the tenant will not be able to deduct the rent paid as professional expenses under Article 53, 33° of the CIR 92. The penalty is therefore severe for tenants who do not comply with this new obligation.

When will you have to comply?

The new measure regarding the conditions of deductibility of rents as professional expenses comes into effect from the 2024 tax year. Rents paid in 2023 relating to the declaration to be submitted during this year 2024 are therefore subject to the new provision.

You’re not ready for this VAT update!

Electronic invoicing

Do you have what it takes?

What is it about?

On 1 January 2026, structured electronic invoicing will become the norm in Belgium for transactions between taxable businesses.

The amendment to the law was published in the Moniteur belge / Belgische Staatsblad on 20 February 2024.

What's the goal?

The aim of electronic invoicing is double:

  1. First, to reduce the VAT gap, i.e. the difference between what the State should receive in VAT receipts and what it actually receives;
  2. Second, to simplify administration for both taxpayers and the State.

The aim of the two-year transition period is to give every taxable person the opportunity to adapt to this new invoicing method.

Does it apply to you?

In 2026, all B2B transactions subject to VAT in Belgium will be covered by the new electronic invoicing method. In other words, this obligation will not apply to B2C transactions.

It should also be noted that exempt taxable persons, flat-rate taxable persons, foreign taxable persons or taxable persons in bankruptcy will not be required to issue electronic invoices.

The same applies when the customer is an exempt taxable person. In this case, as in the case of private customers or non-taxable customers, the supplier will not be affected by these new provisions.

Furthermore, transactions classified as B2G transactions are already covered by specific European regulations in this area.

What does it really mean?

The new definition of this concept was introduced by the European Commission’s ViDA proposal and adopted by Belgium.

A structured electronic invoice is “an invoice issued, transmitted and received in a structured electronic form that allows it to be processed automatically and electronically”.

This means that invoices issued in PDF format will no longer be considered as structured electronic invoices.

By whom can it be issued?

Structured electronic invoices can be issued by:

  1. The supplier itself;
  2. A third party (in the name and on behalf of the supplier);
  3. The customer in the case of self-billing.

Ready to PEPPOL?

To issue the electronic invoice, the federal government has chosen the PEPPOL BIS format and recommends that it be sent via the European PEPPOL network.

“Pan-European Public Procurement Online” is an international standard for sending, receiving and processing electronic invoices.

By joining this network, governments, businesses and other organisations can quickly and easily exchange invoices in total security. Companies can access the network via a single connection to a PEPPOL access point. This network is already in use in many Member States.

However, taxpayers will be able to opt out of the PEPPOL BIS format and choose another system, by mutual agreement between the parties, provided of course that European standards in terms of semantics and syntax are respected.