Belgium

General Information

• Full name: Kingdom of Belgium
• Population: 11.68 million (World Bank 2022)
• Capital: Brussels
• Major Languages: Dutch, French, German
• Monetary Unit: 1 euro = 100 cents
• Main Exports: Machinery and electrical equipment, chemicals, vehicles, metals and diamonds
• GNI per Capita: US $53,890 (World Bank 2022)
• Internet Domain: .be
• International Dialling Code: +32

How Do I Say in Dutch?

• Hello: Hallo
• Good Morning: Goedemorgen
• Good Evening: Goedenavond
• Do you speak English?: Spreek Je Engels?
• Good Bye: Tot Ziens
• Thank You: Dank u
• See you Later: Zie Je Later

Dates

Dates are usually written in the day, month and year sequence. For example, 1 July 2024 or 1/7/24.

Numbers are written with a period to denote thousands and a comma to denote fractions. For example, € 3.000,50 (three thousand Euro and fifty cents).

Belgium stands as a prime destination for international business and investment, thanks to its strategic location at the heart of Europe. Renowned for its high-quality infrastructure, advanced economy, and as a hub of political and economic activity, Belgium offers unparalleled access to the European Union's single market. 

Belgium's geographical positioning is unmatched, nestled between Germany, France, and the Netherlands. Home to major ports like Antwerp, one of the world's largest shipping ports, Belgium offers robust logistics and transportation networks including road, rail, and air, facilitating smooth access to European and global markets. This connectivity is bolstered by state-of-the-art telecommunications and IT infrastructure, making Belgium an ideal location for businesses aiming to serve the European market.

Belgium's membership in the European Union and its proximity to the EU’s institutions in Brussels, the de facto capital of the EU, provide unique access to European policymakers and regulatory frameworks. Businesses operating in Belgium benefit from the EU's single market, allowing for the free movement of goods, services, people, and capital. This access facilitates easier expansion across Europe, making Belgium a strategic base for companies looking to tap into the broader EU market.

Belgium's economy is diverse, with strong sectors including pharmaceuticals, chemicals, automotive, food processing, and information technology. The country's focus on high-quality products and services, innovation, and research and development creates opportunities for investment in these and emerging sectors like biotechnology, green energy, and digital media.

Doing business in Belgium offers strategic advantages, including a central location, a highly skilled workforce, and access to the European market. With its supportive business environment, robust infrastructure, and commitment to innovation and sustainability, Belgium is poised to welcome and nurture investments from around the globe. Whether you're a startup eyeing the European market or a multinational looking to consolidate your presence in Europe, Belgium presents a compelling case as your next business destination.

Belgium presents a compelling investment landscape because of its strategic location, economic stability, and innovative ecosystem. This European nation offers a multitude of benefits for businesses considering expansion or establishing new operations. Here are several reasons why investing in Belgium is a strategic choice for businesses aiming for growth and success in the European market and beyond.

One of Belgium's greatest assets is its multilingual and highly skilled workforce. The country's education system is among the best in the world, producing a talent pool that is proficient in English, French, Dutch, and often German. This linguistic versatility, combined with high levels of education and skills in sectors such as engineering, ICT, and biotechnology, makes Belgium's workforce a valuable resource for multinational companies operating in diverse markets.

Belgium offers a favorable business climate with a competitive corporate tax framework and incentives for research and development, innovation, and environmental sustainability. The government provides various forms of support and incentives for foreign investors, including tax deductions, grants, and financing options for startups and scale-ups. Belgium's commitment to maintaining a pro-business environment ensures that companies enjoy a supportive ecosystem for their investment and growth.

Investing in Belgium provides access not only to the Belgian market but also to the broader European market of over 500 million consumers. Belgium's diverse and affluent population offers a lucrative market for a wide range of products and services, from luxury goods and gourmet foods to innovative tech solutions. The country's open economy and high purchasing power make it an attractive destination for companies looking to introduce new offerings or expand their product lines.

Belgium is at the forefront of sustainability and innovation, with a strong focus on developing green technologies, renewable energy, and sustainable practices. The government's commitment to environmental stewardship and innovation creates numerous opportunities for businesses in sectors such as clean energy, sustainable agriculture, and eco-friendly products and services.

Overall, Investing in Belgium offers businesses a strategic advantage in accessing the European market, leveraging a highly skilled and multilingual workforce, and benefiting from a supportive business environment. Belgium's commitment to innovation, sustainability, and advanced infrastructure makes it an attractive destination for companies looking to grow and succeed in today's competitive global landscape. Whether you're looking to tap into the European market, invest in research and development, or capitalise on Belgium's strategic location, Belgium presents a wealth of opportunities for forward-thinking businesses.

Foreign Direct Investment (FDI) is of significant importance to Belgium's economy. The country, known for its robust infrastructure and strategic location in Europe, attracts a great deal of attention from foreign investors.

Belgium was among the top 20 countries in the world for both inward and outward FDI stock, as reported by the United Nations Conference on Trade and Development (UNCTAD). FDI in Belgium saw a significant increase in March 2023, as it rose by 3.2 USD billion compared to an increase of 2.0 USD billion in the previous month.

Regarding industry-specific investments, Belgium encourages FDI mainly in sectors such as biotech, energy, defense (including dual-use products), cyber-security, and electronic communication or digital infrastructure. Any foreign investment that results in acquiring 10% or more voting rights in a Belgian entity, active in these sectors and having a turnover of more than €100 million in the financial year preceding the investment, is subject to review.

However, investing in Belgium might also present challenges. Belgium's economic environment is influenced by the economic situation of the Euro Zone, which could lead to economic instability. Additionally, the high cost of salaries, the high level of corporate tax, and complex procedures of dismissal could be seen as hurdles for foreign investment.

The Belgian government actively encourages and facilitates Foreign Direct Investment (FDI) through various strategies including:

• Financial Incentives: These include tax benefits, grants, and financing assistance for projects contributing to regional development or innovation. The qualifying sectors range from manufacturing to service industries.
• On-site Support: Invest Belgium, regional development agencies, and local investment offices provide comprehensive assistance, from finding suitable locations to guidance on legal, administrative, and fiscal issues.
• R&D Support: Belgium provides a highly supportive environment for R&D initiatives, including payroll tax exemptions for researchers and patent income deductions, making it an attractive hub for innovation-focused businesses.

Payments to the Belgian authorities and to employees in Belgium can be made from a bank account outside Belgium.

This information is currently being updated for 2024.

Identification as an employer is carried out via the 'WIDE' application (Werkgever-IDentificatie/ion-Employer). Each employer must be identified with the Banque Carrefour des Entreprises (BCE) and have a unique company number. The identification of employers with public authorities is done based on this company number (BCE number). After processing the electronic application via 'WIDE', the employer will receive a notification from the ONSS containing:

• The final ONSS number.
• The BCE number if the ONSS assigns the BCE number.
• The NACE code (general classification of economic activities in the European Community) qualifies the activities of their company.
• The employer categories assigned.

The service provider receives a copy of this notification. Identification as an employer with the ONSS is not only included in the directory of employers but also the BCE. Only the employer listed in the directory of employers has access to online social security services and any change relating to the company (head office, address, activity, legal form, etc.) must be communicated to the ECB.

This information is currently being updated for 2024.

Individuals who are citizens of a country within the European Economic Area (EEA), or are Swizz citizens, do not require a work permit. All non-EEA nationals require an employment permit.

Short Term Work Permit

• Individuals can apply for a short-term work permit if they’re in Belgium for up to 90 days in a 180-day period due to:
  • Transferring short-term to a Belgian branch of a UK-based company
  • Providing short-term services to a client in Belgium
• To qualify, individuals must meet minimum salary requirements, keep their UK employment contract and stay on the UK payroll.
• This application process can take 4 to 12 weeks.
• Dependents are not permitted with this permit type.

Single Permit EU Intra Company Transfer (EU ICT)

• Individuals can apply if their foreign-based company moves them to the Belgian branch to work for up to 3 years or 1 year if they’re a trainee.
• To qualify, individuals must:
  • Be a manager, specialist, or trainee.
  • Have worked for the company abroad for at least 3 to 6 months.
  • For trainees, have a bachelor’s level degree, or master’s degree.
  • Keep their UK employment contract.
  • Stay on the UK payroll.
• This application process can take 3 months and is valid for 1 year. This permit can be extended for up to 3 years if the individual is a manager or specialist.
• Dependents are permitted with this permit type.

EU Blue Card

• To qualify, individuals must:
  • Have an offer of employment from a Belgian company for at least 1 year.
  • Be on the Belgian payroll.
  • Meet minimum salary requirements.
  • Have at least 3 years of education at a bachelor's degree level
• The application process can take 2 to 3 months and is valid for up to 3 years which can be extended.
• Dependents are permitted with this permit type.

This information is currently being updated for 2024.

The tax year runs from 1 January to 31 December.

Employers are obliged to deduct Professional Withholding Tax (PWT or Precompte Professionel in French) from their employees' earnings per the issued tax withholding tables.

The employing entity is responsible for withholding income taxes and any social security contributions payable from employment income and pensions, for making payment to the employee of any Belgian government allowances, and for making the required returns to the Belgian authorities.

Manual workers must be paid at least every 16 days and white-collar workers must be paid at least once a month.

A salary payment is due at the very latest four working days after the end of the period to which it relates. As an example, the April salary must be paid by the 4th working day in May.

This information is currently being updated for 2024.

Each month the employer pays a considerable amount on top of your salary into the social security fund. The employee also pays a proportion of their gross salary in social security contributions. This fund is then used to pay social security allowances:

• Allowances in the event of sickness
• Unemployment benefits
• Allowances in the event of incapacity for work through sickness or invalidity
• Allowances in the event of accidents at work
• Allowances in the event of industrial disease
• Family allowances
• Pensions

The employer must make a final year-end report of employment income that provides a detailed breakdown of each employee's earnings.

The employer must remit the funds deducted via PWT to the Federal Fiscal Administration based on the following timetable:

• Small employers (annual remittances less than EUR 41,700) make a quarterly remittance.
• Large employers (annual remittance EUR 41,700 or more) make a monthly remittance.

Payment of the funds deducted must be made to the fiscal authorities by the 15th day of the month following the end of the month or quarter.

This information is currently being updated for 2024.

Employers must submit a DIMONA IN Declaration to Déclaration IMmédiate/ONmiddellijke Aangifte (DIMONA) to register new employees with the National Social Security Office (NSSO) before their first day of work.

This information is currently being updated for 2024.

Employers must submit a DIMONA OUT Declaration to Déclaration IMmédiate/ONmiddellijke Aangifte (DIMONA) to register leaving employees with the National Social Security Office (NSSO). This must be submitted, at the latest, the next working day after the last day of employment.

Employers must give employees notice of their employment termination in writing. The employee must also be given paid time off during their notice period to look for other employment.

It is legally acceptable in Belgium to provide employees with online payslips, but the employer must obtain each employee's express written permission to do so. The employer must provide the employee with a written statement of pay each time that their salary is paid.

Reports

Payroll reports must be kept for at least five years.

Belgium Payslip Example

This information is currently being updated for 2024.

The minimum wage in Belgium varies across sectors and is determined by collective labour agreements (CCT) within joint committees. Collective labour agreements consider the following during minimum wage calculations:

• Field of work
• Working hours
• Level of seniority

Holiday Accrual

Full-time employees are entitled to a maximum of 4 weeks of annual leave per year and at least 24 days for 12 months' work.

White-collar employees are entitled to 2 days of annual leave per completed month of work in the previous year. These employees also receive “double holiday pay” which is paid by the employer and is equivalent to their normal gross monthly salary plus a holiday bonus of 92% of the gross monthly salary.

Additionally, collective labour agreements concluded within a joint body may provide extra holidays for employees.

Maternity Leave

Employees are entitled to 15 weeks of maternity leave. Maternity leave can start up to 6 weeks before the birth date. Female employees must take maternity leave for at least 1 week before and at least 9 weeks immediately after the birth date. Pregnant employees are not allowed to work overtime.

Employers do not pay maternity leave allowance. Employees receive maternity leave allowance from their health insurance fund. The rate of payment for maternity leave is:

• 82% of gross salary for the first 30 days of maternity leave.
• 75% of gross salary from the 31st day and beyond.

Paternity Leave

Employees are entitled to 20 weeks of paternity leave from 01 January 2023. Paternity leave is also known as birth leave in Belgium. Paternity leave must be taken within 4 months of the birth date or adoption date.

The rate of paternity leave allowance for the first 3 days is 100% of the gross salary and is paid by the employer. The rate of payment for the remaining days is 82% of gross salary and is paid by an employee's health insurance fund.

Sick Leave

Employees are entitled to statutory sick pay during the first 30 days of absence which is paid by the employer, based on the normal salary. After this period, an employee will receive sickness benefits which are paid by the Heath Insurance Fund (Mutuelle/Ziekenfonds).

National Service

There are no national service obligations in Belgium.

As of 2024, the minimum wage in Belgium varies depending on the region and specific employment circumstances.

This information is currently being updated for 2024.

The regular working week in Belgium is Monday to Friday 9am to 5pm.

Some sectors, including retail and hospitality, the working week can range from Monday to Sunday.

Working hours must not surpass 8 hours per day or 38 hours per week.

There are multiple statutory holiday schedules within Belgium. Below are the statutory national holidays in Belgium for 2024.

This information is currently being updated for 2024.

Taxable Employer Benefits

The following benefits include:

• Company car
• PC and an Internet subscription
• Housing
• Free heating and electricity supply

Non-Taxable Employer Benefits

The following benefits include:

• Meal vouchers up to 8 EUR
• Saint Nicholas, Christmas or New Year vouchers that don't exceed EUR 40, and all employees receive the same benefit.
• Gift vouchers that don’t exceed EUR 50
• An honorary award that doesn’t exceed EUR 120
• Retirement vouchers that don’t exceed EUR 40 per complete year of service for the employee.

Expenses

The key changes in income tax, social security, and employment law in Belgium for 2024 include a variety of reforms and adjustments.

Tax Reform Proposal

The Belgian Minister of Finance has proposed a tax reform aiming to reduce taxation on labour income.

This includes an increase in the tax-free amount and widening of certain tax brackets in the progressive income tax scales.

The reform also targets a simplification of the personal income tax return by eliminating certain tax reductions and deductions over a 20-year period.

Corporate Income Tax Measures

The conditions for holding a real estate investment fund are expected to be tightened, with a possible introduction of a minimum holding period to maintain the benefit of the existing advantageous tax regime for these funds.

Combating International Tax Evasion

Following the introduction of the EU Anti-Tax Avoidance Directive (ATAD), Belgium has a controlled foreign company (CFC) legislation targeting artificial constructions set up to obtain tax advantages.

The non-distributed profits realised by the CFC in non-genuine arrangements set up for tax advantages are subject to this legislation.

Increase in Security Tax Rate

There will be an increase in the security tax rate, which is a tax on holding certain security investments.

Mandatory E-invoicing

The introduction of mandatory e-invoicing for taxable persons (B2B) is set from January 1, 2026.

Fight Against Tax Avoidance

This includes stricter CFC rules, with taxation of passive income subject to low taxation abroad, unless sufficient substance is available locally.

It's important to note that some of these changes are still proposals and are subject to the legislative process. The exact impact of these measures will become clearer once the legislative texts are finalised.

Please note that this document gives general guidance only and should not be regarded as an authoritative or complete statement of the law, regulations or tax position in any country. You should always seek specific advice for each specific situation. This document should not be relied upon as professional advice and activpayroll accepts no liability for reliance on its contents.