For years, many people thought they could safely “forget” the income they had outside Belgium; the taxman would never find out. The EU Savings Directive was a rude wake-up call as the Belgian tax authorities started receiving information about overseas bank accounts and enquiring about overseas bank accounts. And when Belgian banks started reporting to the tax authorities abroad, they thought “Surely, Luxembourg and Switzerland …
2020 Tax Return: Tax on Securities Accounts
In 2018 Belgium introduced a wealth tax; in 2019, the Constitutional Court declared the tax discriminatory and annulled the tax … for the future. This means that you must pay the tax a last time in 2020. What is this tax? If you own one or more securities or brokerage accounts with a bank, a brokerage firm or an investment firm and all your securities …
2020 Tax Return: Stock Exchange Tax
Belgium has always charged a tax on stock exchange transactions, such as the purchase and sale of some financial instruments (bonds and stocks) on a secondary market, and the sale of mutual funds (UCITS), through a Belgium-based professional intermediary, a bank or broker. The tax is also due when you buy or sell through a foreign bank or on an online account. And you must …
2020 Tax Return: Box XIV – Trusts
Moreover, you have to confirm whether you have set up a legal arrangement (a “construction juridique”) or whether you are the beneficiary of such a legal arrangement. This is a difficult word for a trust, a foundation, or a foreign company in which you accumulate income tax-free. Cayman tax If you have such a legal arrangement, you must also declare the interest and dividends that …
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2020 Tax Return: Box XIV – Overseas Bank Accounts and Insurance Policies
In box XIV you have to confirm whether you have bank accounts outside Belgium, even if you didn’t have any income on these accounts. Do I have to report the money on my bank account? No, you tick the box with code 1075, list the countries where you have bank accounts with the name of the account holders. You also tick the box to confirm …
2020 Tax Return: Box XII – Paying your Taxes in Advance
If you have paid your tax in advance, e.g. because you don’t have an employer who deducts the tax from your salary, you report that under 1570/2570 in Box XII. Paying the tax in advance is highly recommended, in particular for self-employed. Not doing so results in a tax increase of 2.25% of the tax. If you don’t have to pay the tax in advance …
2020 Tax Return: Box X – Other Tax Deductions
Box X is for all sorts of payments or expenses that you have made and for which you can claim a tax reduction. That goes from donations to charities (1394): the minimum is €40 per charity, if you have a tax certificate of the donation, you can recover up to 45% of the gift by reducing your tax bill; childcare (1384): you can deduct €11.2 …
2020 Tax Return: Box IX – Mortgages
In box IX you mostly report interest and mortgage payments to buy your main residence (under I) or another property (under II). The tax incentives to buy your main residence are a regional matter and you will see that the codes relating to your main residence start with a 3 (for him, on the left) or a 4 (for her). The rules depend on whether …
2020 Tax Return: Box VIII – Maintenance Paid and Losses from Previous Years
Losses If you have made losses in past years, i.e. you had more expenses than income, you can carry forward these losses to later years and deduct them here. Maintenance paid If you pay alimony and/or child support to your ex, you can deduct 80% from your income. Maintenance paid can be deducted up to 80% if you have a legal obligation under the civil …
2020 Tax Return: Box VII – Investment Income
Box VII is for the income of your investments, i.e. dividends and interest. These are normally taxed at source; the (Belgian) bank or the company that pays the dividend deducts 30% tax when they pay out. If that is the case, you don’t have to declare the interest or dividends in your tax return, but foreign banks do not withhold Belgian tax If you received …