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Our areas of expertise include:
- International tax law
- Permanent establishment in Belgium
- Income tax in Belgium
- International wealth management
- Expats
- Tax disputes
- VAT
- Fiscal representation
Foreign companies doing business in Belgium always have to deal with Belgian VAT (also known as BTW or TVA). This usually raises a number of questions. It often concerns the correct assessment of VAT liability, the correct collection and payment of VAT to the tax authorities, the necessary application for a VAT identification number, the maintenance of proper VAT accounting and the retention of the necessary VAT documents, the refund of VAT in Belgium, etc. The mere transfer of goods owned by you to a warehouse in Belgium is also associated with VAT obligations. Would you like VAT advice or tax law support from a multilingual Belgian tax lawyer or tax consultant? Our tax law expert Thomas Hermie (LL.M.) will be happy to advise you.
Belgian VAT
All services provided or goods supplied by a company are generally subject to value added tax (VAT) in Belgium. In the German-speaking part of Belgium, turnover tax is often referred to as VAT. In the Flemish-speaking part, it is called belasting over toegevoegde waarde, or BTW for short. In French, it is called taxe sur la valeur ajoutée, or TVA for short.
This tax is levied on the final consumer, usually the customer, in addition to the regular price of the goods. It is therefore an indirect tax. VAT therefore has no impact on a company’s turnover, at least not if the company is entitled to deduct 100% of the input tax.
The normal VAT rate in Belgium is 21%. A reduced rate of, for example, 6% or 12% may be applied in exceptional cases regulated by law, e.g. for foodstuffs, certain construction and renovation work, short-term (hotel) accommodation, catering and hospitality, passenger transport or certain energy products.
Who is liable for VAT in Belgium?
In principle, all companies established in Belgium are subject to VAT from the first euro of turnover. However, there is an exemption scheme for small businesses established in Belgium with an annual turnover of no more than €25,000 (excluding VAT). These companies are exempt from most VAT obligations. In addition, even if a company is not established in Belgium and does not have a permanent establishment for income tax purposes in Belgium, it may still be liable for VAT in Belgium under certain circumstances. Particularly in cross-border tax cases, the company’s VAT liability in Belgium depends on the circumstances of the individual case. However, the tax liability is often shifted from the supplying company to the B2B customer (i.e. corporate customer) established in Belgium (i.e. application of the reverse charge procedure). However, this does not apply to supplies to B2C private customers.
It should also be noted that, in principle, the reverse charge procedure cannot be applied when using non-Belgian subcontractors. In the construction, assembly and crafts sectors, this often means that the main contractor and/or its subcontractors must register for VAT in Belgium. This is also often the case when organising events and seminars.
It is advisable to have the existence of a possible VAT obligation checked by a tax law expert. Failure to comply with the relevant obligations on the part of the foreign company could result in the payment of the evaded Belgian VAT as well as substantial fines and interest.
Obligations of a person liable for VAT
In cross-border tax cases, there is often an issue with VAT being collected in the wrong country by mistake. However, in Belgium, a „spontaneous regularisation“ process is in place. This process enables the correction of VAT losses, thereby minimising their impact, by acting promptly and in a timely manner. Drawing upon our extensive experience and strong network of professional connections in this area, we are well-positioned to offer you expert guidance and support.
In the event that you have been charged Belgian VAT and do not possess a Belgian VAT number, it is possible to reclaim the VAT you have paid. Our team is here to assist you with this process. Our dedicated team will first assess the refundability of the VAT and provide comprehensive support throughout the application process. We will also handle all correspondence with the Belgian authorities and monitor all deadlines. In the event of a non-refund, we can also initiate an appeal procedure on your behalf.
VAT refund or correction
In cross-border tax cases, there is often an issue with VAT being collected in the wrong country by mistake. However, in Belgium, a „spontaneous regularisation“ process is in place. This process enables the correction of VAT losses, thereby minimising their impact, by acting promptly and in a timely manner. Drawing upon our extensive experience and strong network of professional connections in this area, we are well-positioned to offer you expert guidance and support.
In the event that you have been charged Belgian VAT and do not possess a Belgian VAT number, it is possible to reclaim the VAT you have paid. Our team is here to assist you with this process. Our dedicated team will first assess the refundability of the VAT and provide comprehensive support throughout the application process. We will also handle all correspondence with the Belgian authorities and monitor all deadlines. In the event of a non-refund, we can also initiate an appeal procedure on your behalf.
Optimising EU imports via Belgium through a (favourable) import licence
The import and export of goods is closely linked to VAT. In Belgium, it is possible to apply for a special import licence that allows the applicant to declare the import VAT on the Belgian VAT return under the reverse charge mechanism (instead of pre-financing it to the customs agent or customs office). The possibility of declaring the import VAT in the VAT return results in a cash flow advantage, as the import VAT does not have to be pre-financed. We would be happy to apply for this licence for your company.
Preliminary VAT assessment or administrative confirmation
If you are unsure about a specific VAT issue, you can ask the Belgian VAT administration for a preliminary ruling or administrative confirmation and thus obtain legal certainty. Here too, we can provide you with expert assistance.
Our activities in the area of VAT
Wenn Sie sich in einer bestimmten Angelegenheit umsatzsteuerlich nicht sicher sind, können Sie bei der belgischen Mehrwertsteuerverwaltung einen Vorbescheid oder eine administrative Bestätigung beantragen und so Rechtssicherheit erlangen. Auch hier können wir Ihnen fachkundige Unterstützung bieten.
Our activities in the area of VAT
- Examination of the VAT liability in BelgiumApplying for a Belgian VAT identification number (VAT ID number)
- Fiscal representation
- Support in the management of correct VAT accounting and VAT documentation
- VAT returns and other compliance (e.g. Intrastat) in Belgium
- Optimisation of VAT (rates)
- Refund of VAT in Belgium
- Support with correspondence with the tax authorities in the respective national language (see also Tax disputes)
- Comprehensive advice in miltiple languages on Belgian VAT
Our VAT team
In principle, our VAT team covers the whole spectrum of indirect taxes. We start by checking whether your company is liable for VAT in Belgium. If this is the case, we offer foreign companies a comprehensive service covering all aspects of VAT in Belgium: from applying for a VAT identification number to preparing and filing VAT returns on time and preparing outgoing and incoming VAT accounts in accordance with Belgian VAT law.
One of our team’s key strengths is our ability to communicate in a number of languages, ensuring effective client consultations and advice in a language that is familiar and understandable to our clients.
Do you have any questions?
Do you have questions about VAT in Belgium? Do not hesitate to contact our multilingual tax lawyer Thomas Hermie (LL.M.). By e-mail to t.hermie@euregio.law or by telephone on +32 11 29 47 01.
