• Service: Tax, Global Indirect Tax, Global Mobility Services, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 10/25/2013

Belgium - Rules for calculating a notional interest deduction 

October 25:  Changes to the Belgian tax rules are being made in response to a judgment of the Court of Justice of the European Union (CJEU) concerning the calculation of a notional interest deduction.

In the Argenta case, the CJEU determined that for purposes of calculating a notional interest deduction, a Belgian tax law requirement that the value of equity capital must be reduced by the value of an entity’s net worth (when the entity’s income is exempt in a country with which Belgium has concluded an income tax treaty) was incompatible with the freedom of establishment under the EU treaty.

The Belgian tax law is to be amended to revise how to calculate the notional interest deduction.

Other tax measures

Other tax measures concern the following:

  • The reference emission of CO2 needed to calculate the benefit-in-kind of a company car will be calculated over a 12-month period ending on 30 September instead of over the calendar year, so that it will be available before the start of a new year (instead of in the first months of the new year, thus avoiding payroll corrections for those first months).
  • The threshold for filing monthly value added tax (VAT) returns is increased from €1 million to €2.5 million.
  • The minimum amount to qualify as business assets for VAT purposes is raised from €250 to €1,000.

Read an October 2013 report prepared by the KPMG member firm in Belgium: Notional interest deduction: federal government implements ECJ decision in Argenta case

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