Belgian expat tax regime now extended to foreign non-profit organisations

The 1 January 2022 a new expat tax regime introduced in Belgium that provides for a favourable income tax (and social security) treatment for employees, directors and researchers recruited abroad or seconded to Belgium.

Under this regime, an allowance of up to 30% of the gross annual salary (capped at EUR 90,000) can be granted free from tax and social security contributions. In addition, certain expenses such as school and moving costs can be reimbursed free from tax and social security contributions.

The application of the expat regime therefore enables employers to attract skilled personnel from abroad with an advantageous salary package at a reduced employer cost.

The scope of application was (for the non-profit sector) originally limited to non-profit organisations in the Belgian legal form of VZWs and IVZWs, excluding e.g. foundations or foreign non-profit organisations operating in Belgium.

Following an appeal (against this omission) to the Belgian constitutional court intro­duced by Tiberghien, the legislator has now extended the scope of application.

From now on, every enterprise registered with the Belgian Crossroads Bank for Enter­prises, regardless of its legal form, place of incorporation or tax residence, can benefit from the new tax regime for expats in Belgium (provided of course that all other conditions are met).

For foreign non-profit organisations, the expat regime can apply to personnel hired or seconded to Belgium as of 1 January 2023.

To apply the expat tax regime, a written application should be filed ultimately within 3 months following the date of entry into service of the expat in Belgium.

For any questions, contact the authors of this article.

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