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Help! I received a tax return from the Belgian taxman…

Pensioner under the sun

I live in Cyprus and I just received a tax return from the Belgian tax authorities that must be filed by 3 December.
My husband worked in Belgium years ago, I never lived there. He died seven years ago; I now receive a widow’s pension. I never received an income tax return – and neither did he, as far as a remember.
Why do I receive an income tax return now? And why such a short deadline?

This is indeed, the first time/year that the Belgian tax authorities have sent out tax returns to pensioners living outside Belgium.

If you receive a pension from Belgium, either a state pension or a private pension (from a pension fund), that pension is – in principle – liable to tax in Belgium. If tax is due, the organisation paying out the pension withholds tax, unless the pension is too low (i.e. under the personal allowance of €8,860 in 2019, €8,990 in 2020). However, it is only if you have more than 75% of your income from Belgium.

When you are a taxpayer living in Belgium, you must file an income tax return in which you declare the pension as well as any other income you have in Belgium. The tax authorities can then calculate if you have to pay more tax.

That does not change when you live outside Belgium.

If you receive a state pension or a private pension from Belgium, that pension is still liable to tax in Belgium … in principle.

Indeed, there may be a double tax treaty between Belgium and your country of residence. If there is no double tax treaty, then income tax will be due in Belgium.

If there is a double tax treaty, that usually says whether Belgian tax is due on the pension or not. We would need to look at the text of the treaty.

Generally speaking, the pensions office knows whether there is a double tax treaty, and it withholds tax at source if Belgian tax is due and if the pension is high enough to pay income tax. Of course, the pensions’ office can only calculate that on the basis of the pension they are paying. They do not know if you receive other pensions or other income that is liable to tax in Belgium.

That can only be determined through your tax return.

In the past, the Belgian tax authorities did not send out income tax returns ; they relied on the pensioner to apply for, and file, a Belgian income tax return.

Some pensioners did, most did not.

This year, the Belgian tax authorities have taken another approach and sent out tax returns to pensioners living outside Belgium.  They know your address because the Belgian pensions office has given them that information together with the amount of the pension and the tax withheld.

They sent the tax returns to all pensioners.

This is very annoying for tax advisers who, in the past, received the tax returns on behalf of their clients.  The tax returns are now sent to the clients’ home addresses in Sweden, the UK, Jersey, Gibraltar, France, Spain, …  The clients need to send the tax returns back to their advisers and that wastes time.

And the deadline is 3 December. 

In principle, the tax authorities must give you at least five weeks to file your income tax return. It seems that they have sent out the tax returns too late to give you five weeks

What’s more, the Belgian tax authorities cannot even confirm to which taxpayers they have sent tax returns.

Update (27 November 2020): the deadline has just been extended to 15 January.

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