Income tax liability over an individual persons Belgian income tax payments to the Belgian income tax authorities are usually determined by the persons residency status; an individual can be a resident or a non-resident.
A Belgian resident refers to someone who has entered Belgium, either as a single individual or carrying a family with intentions to stay between 18 to 24 or more months. This time period naturally depends on circumstances. A non-resident in Belgium is an individual who isn’t a resident or refers to those expatriates whose concession over tax is assessable on their income worldwide. Under certain conditions and circumstances, an individual may qualify for expatiate tax concessions. A taxpayer who qualifies for the expatriate tax concessions with Belgian income tax is always deemed as a non-resident taxpayer.
The rule around Belgian income tax states that in general a person who is actually a resident of Belgium is assessable on their income gained worldwide. Any non-residents are usually assessable on any income indirectly or directly derived from sources within Belgian borders.
Belgian Income Tax : Extended Business Travellers
Any extended business travellers are most likely to be considered Belgian non-residents for purposes of tax, unless they have entered with the general intentions of staying beyond 24 months. Individuals who transfer their tax residence may be eligible for the expatriate tax concession.
Income from employment is generally treated as Belgian income tax sourced in Belgium (Belgian sourced income) or as Belgian-sourced compensation. The compensation being where the person performs the services in question while located physically in Belgium.
Belgian Income Tax : Tax Trigger Points
There is no technical minimum number of days that exempts an employee from the filing and paying of Belgian income tax. There will be no tax liability if the individual qualifies for relief in respect of ‘the dependent personal services article of the application double tax treaty’.
The exemption of the treaty doesn’t apply if the Belgian entity is the individual’s economic employer. The treaty is also exempt if the individual is working for a branch of a foreign employer directly within Belgian borders. There are similar rules which apply should the individual be unable to rely on any tax treaty at all.
Belgian Income Tax: Types of Taxable Income
For extended business travellers, the type of taxable income typically taxed is income from employment, and this includes non-cash benefits in kind, examples being a company car and/or company housing.
Depending on the actual circumstances and facts, some payments and allowances may be tax exempts.