Taxes in Belgium

Written by Lais Cattassini Moderated by Oleksandra Dosii

Lais Cattassini

Lais is a Brazilian journalist and copywriter with over 17 years of experience, writing about things she knows really well (travelling, cinema, social media trends) and things she loves learning about.

Oleksandra Dosii

Oleksandra is a dedicated marketer with a passion for growing HR-tech products. She believes content marketing is about delivering high-quality content that provides value—not just generating leads. Since 2016, Oleksandra has been involved in tech talent relocation.

Last update: September 16, 2024

Next update: Scheduled for February 1, 2025

Belgium has a taxation system that covers personal income, corporate income, value-added tax (VAT), property taxes, and more, all of which are regulated at both the federal and regional levels.

Belgium’s personal income tax (PIT) system is progressive, meaning the rate of tax increases as income increases. The personal income tax rates for residents range from 25% to 50%, divided across multiple income brackets.

Taxable income tax in Belgium is based on global income from various sources, including employment income, pensions, rental income, investment income, and capital gains.

The country has a Pay-As-You-Earn (PAYE) system for employees, meaning income tax is withheld directly from wages. Self-employed individuals and independent professionals must make advance payments throughout the year based on expected income, with final tax adjustments made after filing an annual tax return.

In regards to regional taxes, Belgium is divided into three regions: Flanders, Wallonia, and Brussels. Each region has the power to levy additional taxes, such as vehicle registration tax, environmental taxes, or real estate transfer tax.

This layered structure makes Belgium one of the higher-taxed countries in Europe, especially when combining income tax with social security contributions.

What is the income tax in Belgium?

Income tax in Belgium is based on a progressive taxation system and is imposed on individuals' worldwide income, including salaries, pensions, rental income, and investment income. Belgium’s income tax rates are relatively high compared to many other countries, and the system includes several deductions and allowances to reduce the taxable base.

The personal income tax (PIT) rates in Belgium are divided into brackets, with rates ranging from 25% to 50% depending on income levels:

These rates apply to net taxable income, which is the total income after subtracting allowable deductions and expenses.

Social Security contributions

In addition to income tax, Belgium requires individuals to pay social security contributions, which are significant. These contributions fund healthcare, pensions, unemployment benefits, and other social services.

Employees in Belgium must pay social security contributions based on their gross salary. The standard rate for employees is 13.07% of their gross income. These contributions are automatically deducted from their salary by their employer and forwarded to the Social Security system. Employers in Belgium are required to contribute a much larger share to the social security system on behalf of their employees. The employer's contribution is 27% of the employee’s gross salary.

Self-employed individuals in Belgium have a different structure for social security contributions. The amount they contribute is based on their net professional income, and the rate is around 20.5%. These contributions cover a more limited range of social security benefits.

For student jobs, social security contributions are reduced, as students are allowed to work under a special social security status for up to 600 hours per year at a much lower rate. Part-time workers are subject to the same contribution rates, but the total amount paid depends on their gross earnings.

Social security contributions entitle individuals to various benefits, including healthcare, pension entitlements, unemployment benefits, sickness and disability benefits, and family allowances.

Online tax calculator for taxes in Belgium

Calculating taxes in Belgium involves determining both income tax and social security contributions. Belgium offers various tax deductions and allowances that also need to be considered. You can calculate your net income here.

You can also use the Belgian Federal Public Service (FPS) tool to get an estimate of how much you’ll have to pay in taxes.

Annual tax returns in Belgium

In Belgium, most residents are required to file a tax return. Although taxes are withheld at source (via the Pay-As-You-Earn system), employees still need to file returns to declare other types of income and claim deductions or tax credits. Self-employed individuals, pensioners and residents with foreign income must also declare their full income and pay tax on profits. Non-residents working or earning income in Belgium may also need to file a non-resident tax return.

In Belgium, the tax year runs from January 1 to December 31, and the tax return corresponds to the income earned during that year. For instance, taxes on income earned in 2023 will be declared in a 2024 tax return.

It is possible to file your tax return by paper, which is due around June. Or online, for which the deadline is September. The exact deadlines can vary slightly from year to year, so it's essential to check the official announcements.

With both options, you will receive a pre-filled tax return form with information the government might already have. You can accept it, if correct, or edit and make the necessary changes. You must declare all worldwide income, which includes salaries, pension income, rental income, interest and dividends, and foreign income.

Once the tax authorities receive your return, they will review it, assess your tax liability, and send you a tax assessment notice detailing if your withheld taxes or advance payments were insufficient – and you will need to pay the outstanding amount – or if you overpaid during the year (due to deductions or credits) – and you may be entitled to a tax refund.

How to pay less taxes

You can take advantage of tax allowances, deductions, and credits in Belgium:

Professional expense

You can reduce your taxable income by deducting professional expenses related to your job. Standard deductions are automatically applied by the tax authorities, typically 30% of gross salary, with a cap (around €5,520 for 2024). This is the easiest method as you don’t need to provide documentation.

If your work-related expenses exceed the standard deduction, you can claim actual costs (e.g., travel expenses, work equipment, training), but you must provide evidence (receipts, invoices).

Pension savings plan (third pillar pension)

Contributing to a pension savings plan or long-term savings plan allows you to benefit from a tax reduction of 30% on the amount contributed, up to a capped limit. In 2024, you can choose between two contribution limits, up to €990 is a 30% tax reduction, and up to €1,270 there is a 25% tax reduction.

Mortgage interest and capital repayments

Homeowners who took out a mortgage loan before 2015 may benefit from regional tax incentives related to their home loan. These deductions apply differently based on your region (Flanders, Wallonia, Brussels) and can include mortgage interest deduction, capital repayment deduction, and home-saving scheme.

For mortgage loans after 2015, mortgage-related deductions have largely shifted from the federal to the regional level, so you should check with your regional authorities for current policies.

Childcare expenses

You can claim a deduction for childcare expenses incurred for children under the age of 12 (or under 18 if the child has a disability). The tax deduction is 45% of the amount spent, capped at €14 per day, per child.

Having dependent children provides you with an additional tax-free allowance. This allowance reduces the portion of your income that is subject to tax, and the amount increases with the number of children.

Energy-saving investments

Making energy-saving investments in your home can qualify you for regional tax deductions. The types of deductions and credits vary by region, so it's important to check the specific incentives offered in Flanders, Wallonia, or Brussels.

Charitable donations

Donations to approved charitable organisations can be deducted from your taxable income. The tax deduction is 45% of the amount donated, and the minimum donation to qualify for this benefit is €40 per year. The maximum deductible amount is limited to 10% of your total net income.

Tax credit for low-income earners

If you are a low-income earner, you may qualify for a work-related tax credit. This is a refundable tax credit that can reduce the amount of tax payable. The credit is aimed at workers with lower income levels to help reduce their overall tax burden.

Marriage and cohabitation benefits

Belgium allows couples who are married or in a legal cohabitation arrangement to optimise their taxes by transferring a portion of income between partners. If one partner earns significantly less than the other, the lower-earning partner can transfer up to 30% of their taxable income to the higher-earning partner. This can help avoid the higher tax brackets and reduce the overall tax burden for the household.

Medical expenses

Certain medical expenses not covered by social security or private insurance can be deducted from your taxable income. This includes costs like dental work, hospital bills, and specialised treatments.

Talk to a tax advisor

For those with more complex tax situations, especially expats with international income, it may be beneficial to consult a tax advisor or accountant. These services ensure you pay correctly and can help collect benefits, allowances, and deductions. For expats, services like these can be even more beneficial, as they help foreigners overcome language barriers and the complicated tax regulations of a new country.

Other Belgian taxes

Aside from income tax, Belgium has several other taxes that individuals and businesses are subject to.

Value-added tax (VAT)

VAT (Belasting over de Toegevoegde Waarde/BTV or Taxe sur la Valeur Ajoutée/TVA) is a consumption tax applied to the sale of goods and services in Belgium. Businesses collect VAT on behalf of the government and pass it on to the authorities.

The standard rate is 21% and it applies to most goods and services. For certain goods like social housing, certain restaurants, and agricultural products there is a reduced rate of 12% and for essential goods such as food, books, medicines, and public transport the VAT rate is 5%.

Property tax (Onroerende voorheffing/Précompte immobilier)

Property tax is an annual tax on the ownership of real estate (e.g., land, houses, apartments) in Belgium. It is based on the cadastral income (a notional rental value assigned to the property) and the tax rate determined by local authorities (municipalities and regions).

Inheritance tax (Successierechten/Droits de succession)

Inheritance tax is levied on assets passed on after death, including real estate, bank accounts, and investments.

Gift tax (Schenkingsrechten/Droits de donation)

Belgium levies a gift tax on assets that are given during a person’s lifetime. Gift tax rates vary by the relationship between the giver and the recipient and the region in which the giver lives.

Registration tax (Registratierechten/Droits d’enregistrement)

This is a tax on the transfer of real estate and certain other transactions (e.g., rental agreements, sales of businesses). The amount depends on the type of transaction and the region.

Environmental taxes

Belgium imposes various environmental taxes, aiming to promote environmental sustainability and reduce pollution. They are applied by regional authorities and can vary significantly from region to region.

Wealth tax (Solidarity contribution)

Although Belgium doesn’t have a general wealth tax, there is a solidarity contribution on securities accounts. This applies to individuals holding large securities accounts in Belgium or abroad.

The tax applies if the total value of securities in the account exceeds €1 million.

Tax treaties with Belgium

Double taxation treaties between Belgium and other countries help prevent the same income from being taxed twice and provide mechanisms for relieving tax burdens.

Belgium has treaties with many countries, including major partners like the United States, the United Kingdom, Germany, France, and the Netherlands. Here is a complete list.