An individual’s net income is taxed through Belgian income tax rates anywhere between 25 per cent and 50 per cent. Belgian income tax rates are identical for both non-residents and resident taxpayers of Belgium. In addition to this, local tax will also be due.
Local tax is calculated on the basis of a percentage of Belgian income tax rates due. The actual percentage amount is dependent on the commune where the taxpayer is living; this can vary between 0 per cent and 10 per cent. However, local tax is set at 7 per cent for non-resident taxpayers.
Belgian Income Tax Rates : 2014
Income tax is withheld at source: from 25 to 50%
From EUR 0 to 8,070 25%
From EUR 8,070 to 11,480 30%
From EUR 11,480 to 19,130 40%
From EUR 19,130 to 35,060 45%
Over EUR 35.060 50%
Residential taxpayers are entitled to individual exemptions, including exemptions for those dependent on the individual (dependents). Non-resident taxpayers aren’t entitled to a single personal exemption unless either the family of the taxpayer is living in Belgium for the entire year or a minimum of 75 per cent of the individuals income is subject to any Belgian income tax rates. Certain taxpayers can claim partial or full exemptions from a personal level, based on tax treaties that have been signed between Belgium and expatriate home countries.
An individual will be regarded as a tax resident and will therefore be subject to Belgian income tax rates if their main home or center of economic interests rest within Belgian borders, if they are registered within the Belgian civil register or if they are present within Belgium for over 183 days in any twelve month period. This will also determine the amount of Belgian income tax.
Belgian Income Tax Rates : Special Expatriate Tax Regime
Any expatriate employed in Belgium will normally be liable towards Belgian income tax rates. Additionally, gift duty, property tax and succession duty can be relevant also. Residents of Belgium pay personal income tax on their total income from all sources worldwide on a sliding scale. Residents are also liable to pay communal and regional taxes at rates between 0% and 8% of the total tax payable from income. Alongside this, the special expatriate tax status also offers two imperative tax benefits to foreign executives: the “tax free expatriation allowances” and the “travel exclusion”.
Belgian Income Tax Rates : Capital Tax Rates
A 15% withholding Belgian income tax rate is imposed on earnings from mutual funds investing more than 40% of their assets in interest-bearing securities. Inheritance tax ranges between 3% and 30% in Wallonia and Brussels regions with 3% to 27% in Flanders. A 16.5% tax is payable on gains on property held for less than 5 years. There is no wealth tax in Belgium.
Belgian Income Tax Rates : Further Useful Information
The filing date for taxes and self assessment is usually by the 30th June of the assessment year. It is worth noting that the United Kingdom and Belgium are bound by a double taxation treaty. The rates for withholding tax dividends are 25% (15% for certain category of shares), Interest: 25% (A 15% rate applies to interest on certain government bonds and interest from regulated savings deposits in excess of the tax-exempt amount), Royalties: 25% (Rate is 15% for income from author’s and neighboring rights and from legal and compulsory licenses).