Tax measures: Corporate Income Tax

Breaking news (adopted by the law of 18 July 2025)

Below you can find more detailed information on related topics to Tax measures: Corporate Income Tax.

Important side note: Only the topics that are highlighted in green have been formally approved by the government. All other topics are proposals and have not yet been formalized.
  1. General

    If dividends are received by Belgian companies, there is a risk of double taxation to the extent that these dividends were already subject to corporate tax at the distributing company and would be included in taxable income in Belgium. 

    To avoid this, a deduction for "dividend received income" was provided, the DRD.

    A company is only entitled to the DRD to the extent that it holds a participation in the capital of the distributing company of at least 10% or with an acquisition value of at least EUR 2,500,000 (participation condition).

    Moreover, it must keep these shares in full ownership for a period of at least 1 year from the date on which the shares were acquired (holding condition).

    Under current legislation, dividends received are deducted from the tax result remaining after the previous operations. 

  2. Government agreement

    The Government Agreement provided for various adaptations to the DRD regime. These included:

    • The DRD deduction would be transformed into a genuine exemption for dividends received by a company.
    • The shareholding threshold of 2.5 million euros would be raised to 4 million euros. This increase would also be coupled with a requirement that the shares have the nature of financial fixed assets. However, these changes would only apply to large companies and transactions between them.  
    • For DRD SICAVs, a 5% tax would be applied in the event of a capital gain. In addition, the possibility of deducting withholding tax from corporate income tax would only be possible if the company receiving the dividends paid out by the DRD SICAV granted a minimum remuneration to its director.
  1. Upcoming and implemented changes

    The law of 18 July 2025 does not include all the above adaptations.

    • a. DRD exemption
      The DRD deduction will be converted into an exemption. The law is silent on this point.


The draft law of 3 July 2025 indicates that the DRD deduction will be converted into an exemption, without providing further details. The explanatory memorandum specifies, however, that this conversion will only be carried out in a subsequent law.


  • b. Holding threshold
    With regard to the holding requirement, the law maintains the current threshold of 2.5 million euros. There is no increase in the threshold to 4 million euros. The new requirement to account for financial assets is also introduced but this requirement will only apply for large companies, hence  “small companies” within the meaning of Article 2 of the Income Tax Code will be excepted.

    This condition of financial fixed assets will also apply to the exemption from withholding tax referred to in article 264/1 of the Income Tax Code (i.e. Tate & Lyle).
    These changes will take effect from the 2026 tax year for the DRD deduction and from July 1, 2025 for the withholding tax.

  • c. DRD SICAVS
    Provisions concerning DRD SICAVs are currently included in the draft Law, various measures of 3 July 2025 but are not decided upon yet.

    The draft law of last 3 July provides for the introduction of a separate 5% levy on capital gains realized on shares or units of investment and real estate companies benefiting from the DRD regime. This targets SICAVs as well as all investment and real estate companies subject to a special tax regime, such as foreign companies having a similar special regime under their national law.

    It should be noted that the distribution of dividends is not subject to this new levy.

    In addition, under the provisions of the law, it is proposed that the offsetting of withholding tax related to dividends benefiting from the DRD regime will only be allowed if the company investing in SICAVs grants, during the taxable period in which the income is received, a minimum remuneration to its company director (see Article 215, paragraph 3, 4° CIR).

    As from the 2026 tax year, it will be important to link this new provision with the evolution of the rules on the minimum remuneration of company directors.

  • d. Intra-group transfer and DRD reduction

    To align the DRD deduction with the Parent-Subsidiary Directive, the law proposes allowing the application of the current year’s DRD deduction to the portion of the intra-group transfer amount that exceeds the negative result determined before including that transfer in the taxable base for the period concerned. This adjustment proposed by the government follows recent decisions related to the interpretation of the Parent-Subsidiary Directive (in particular, the judgment of the Court of Justice of 19 December 2019 in the case Brussels Securities SA v. Belgian State (C-389/18)).

Small companies can enjoy a reduced rate of 20% on the first bracket of EUR 100,000, provided certain conditions are met. The part of the taxable base exceeding EUR 100,000 is taxed at the basic rate of 25%.

Thus, among other things, the company must grant a minimum remuneration of EUR 45,000 to at least one company director. If the remuneration is less than EUR 45,000, it must at least equal or exceed the company's taxable income .

The minimum remuneration requirement is increased to EUR 50,000 on an annual basis, henceforth indexable. Moreover, a maximum of 20% of the remuneration may still consist of benefits in kind.

No provision is currently included in the draft law of 3 July 2025.

VVPR bis regime/liquidation reserve

Dividends distributed by companies that are 'small' can, under certain conditions, benefit from a reduced withholding tax rate instead of the normal 30% rate. 

The favourable VVPR bis regime only applies to new shares issued as from 1 July 2013, either at the time of incorporation of the company or at the time of a capital increase. The shares must be fully paid up and registered. Subject to certain exceptions, the shares may not be transferred after contribution.

Provided that all conditions are met, the VVPR bis regime provides that small companies can pay beneficial dividends as follows:
- If the distribution takes place after a waiting period of three years at a withholding tax rate of 20%.  
- If the dividend is paid only after four years or later, the rate drops further to 15%.

Small companies also have the option to transfer part of their taxed profits to a liquidation reserve. At the time of this entry, there is an anticipatory levy of 10%. 

Upon subsequent distribution of this liquidation reserve, additional withholding tax is due, the rate of which is determined by the time of distribution:
- If the reserve is distributed as a dividend after at least 5 years, a reduced rate of 5% applies.
- If the liquidation reserve is distributed before the end of the 5-year period, an additional withholding tax of 20% applies.
- If the liquidation reserve is not distributed until the liquidation of the company, no additional withholding tax is due. 

The liquidation reserve regime is now being adjusted in an effort to achieve greater harmonisation in taxation between the two regimes. 

Thus, the waiting period for beneficial distribution will be reduced from 5 years to 3 years, but the withholding tax rate will increase from 5% to 6.5%. Converted, this means an effective tax rate of 15% (instead of currently 13.64%), which is in line with the benefit scenario under the VVPR bis regime. Distributions made before the 3-year vesting period has expired will be subject to the normal withholding tax rate of 30%. 

The VVPR bis regime, as we know it today, remains unchanged.

Since an electric company car is not an option for everyone, a wider transition period will be provided for hybrid cars. 

The government will keep the maximum deduction rate for hybrids at 75% until the end of 2027. It will then drop to 65% in 2028 and 57.5% in 2029 (simultaneously with the drop for electric cars). These deduction rates apply for the entire period of use of the vehicle by the same owner/tenant. The fuel costs of hybrids remain 50% deductible until the end of 2027. The electricity. consumption costs of hybrids will have the same deductibility as for electric models. 

The draft law of 3 July 2025 provides for changes regarding the deductibility of plug-in hybrid vehicles, but this applies only to personal income tax (For more details: “Tax measures: Personal income tax”).

Consequently, the deduction schemes relating to car taxation, as provided for by the Law of 21 November 2021, remain applicable to corporate income tax (For more details: “Green mobility: what changes from a tax perspective?”).

An exception to this limited deductibility is provided for hybrids with emissions of up to 50g/km. If the percentage according to the deduction formula exceeds 75%, the higher percentage may be applied until the end of 2027.   

There will be the possibility of accelerated depreciation of certain investments, for example in research and development, defence and energy transition.  

For large companies, this is a temporary system whereby 40% of the acquisition value can be written off in the 1st year. 

For SMEs, there will again be the possibility of degressive depreciation.

The group contribution regime allows a profitable company to transfer (part of) its profits for tax purposes to a group company that realised a loss in the same assessment year. The transferred profit is referred to as 'the group contribution'. 

That group contribution may be deducted by the profit-making (transferring) company from its taxable result, while the loss-making (receiving) company includes the group contribution received in its taxable result. In this way, the profit-making company pays less corporate tax while the loss-making company carries forward no or fewer losses to a subsequent financial year.

This regime can only be applied provided some rather strict conditions are met. Among other things, the transferring company and the receiving company must be at least 90% linked for an uninterrupted period of five years. On the part of the receiving company, it is not possible to offset the group contribution included in the tax base with tax deductions.

The government will make the group contribution system more attractive, flexible and administratively simpler, by allowing both direct and indirect shareholdings, no longer excluding new companies, and allowing dividend received deduction (DRD) on profits arising from a group contribution.

The investment deduction will become indefinitely transferable. 

The rates for the increased investment deduction for the energy, mobility and environmental lists will be harmonised to 40%.

Regarding the investment deduction for research and development, the regional attestation requirement will be removed.

The draft law of 3 July 2025 provides for the removal of the deduction limitation for carrying forward the basic investment deduction. Under the current system, small companies that cannot use the deduction generated in year N must use it in the following year (N+1). Under the new draft law, the investment deduction will become indefinitely carry-forwardable for all categories of investment.

In addition, the draft law proposes to harmonise the rates of 30% for large companies and 40% for small companies into a uniform rate of 40% for all companies for the categories of enhanced investment deduction.

With regard to the technological investment deduction (formerly the investment deduction for patents and R&D), taxpayers will once again be able to combine this deduction with the research and development tax credit (R&D tax credit).

For other investments, the irrevocable choice between the tax credit or the investment deduction will remain applicable.

Finally, the prohibition on combining the thematic enhanced deduction with State aid for regional purposes will be removed.

These changes will take effect on 1 January 2025, coinciding with the entry into force of the law, in order to avoid “the coexistence of two different systems based on early adjustments to an almost new system.” The harmonisation to the 40% rate will take effect from the 2027 tax year.


If certain conditions are met, meal vouchers are exempt from personal income tax on the part of the beneficiary and the employer's contribution of EUR 2 per cheque is tax deductible.

Thus, the employer's contribution to the amount of the meal voucher may not exceed EUR 6.91 per meal voucher. The beneficiaries' contribution must be at least EUR 1.09.

Both the statutory maximum contribution of EUR 6.91 and the deductibility of the employer's contribution will be increased by two times EUR 2 in the coming legislature. 

Also, the spending option of the meal voucher will be expanded. 

The other existing vouchers (eco vouchers, culture vouchers, etc.) will be phased out.

In order for contributions to supplementary pensions to be tax deductible for the company, the statutory pension and the supplementary (non-statutory) pension together may not exceed 80% of the last year's normal gross remuneration. 

If this limit is exceeded, the company cannot deduct the part of the contribution exceeding the 80% rule as professional expenses.

This 80% rule would now be more clearly defined. Moreover, it would no longer be possible to receive an advance on a supplementary pension to finance real estate investments, except for the sole owner-occupied dwelling.

  1. General

    When a company transfers its principal place of business or its seat of management or administration abroad, this transfer is treated as a liquidation for tax purposes. 

    As a result, corporate income tax is due on unrealised capital gains and tax-exempt reserves, unless a Belgian establishment remains after the head office transfer, to which these items are attributed.

    Until now, and this has been confirmed several times by the ruling commission, this fiction of liquidation has not been considered to have any consequences for the shareholders of the company whose registered office is transferred. Strictly speaking, there is no allocation or payment of income from movable assets to shareholders, so in principle, no withholding tax is due. 

  2. Government agreement

    In this respect, the Government Agreement states that the emigration of a legal entity will be treated for tax purposes as a fictitious liquidation of the legal entity, with the application of withholding tax. Thus, the fiction of liquidation would henceforth also apply to shareholders.

  1. Changes introduced by the  Law of 18 July, 2025
    The Law of 18 July, 2025 supplements the notion of dividend to provide that a dividend is deemed to be attributed to the shareholders of a company in the event of transfer of its registered office or when it takes part in restructuring operations (merger, demerger, etc.) resulting in assets being transferred abroad.

    This notional dividend corresponds to the distributed dividend referred to in article 209 of the Income Tax Code, limited in proportion to the shares held. This dividend will constitute income from movable property taxable at 30%, unless it can be exempted by application of the liquidation reserve regime. For corporate shareholders, the definitely taxed income deduction will apply to the notional dividend, where applicable.

    This change applies equally to shareholders subject to individual income tax, corporate income tax and legal entities income tax.

    However, if no dividend is actually paid, no withholding tax can be deducted from the dividend. It must therefore be included in the tax returns of the taxpayers concerned. To this end, companies transferring assets abroad as part of the above-mentioned operations will be required to draw up individual sheets (failing which they will be subject to the distinct contribution referred to in article 219 of the Income Tax Code).

    The law also stipulates that, to comply with European law, a staggered tax payment may be requested in the event of an asset transfer to another Member State.

    Lastly, to avoid double taxation when a dividend is actually paid by the company transferring the assets abroad, and when a capital gain is realized on the sale of these assets, an exemption is provided for shareholders.

    This new exit tax will apply to transactions taking place as of July 29, 2025.

The government will simplify transfer pricing documentation rules, especially for SMEs, and limit them to the essentials.

The government will abolish Annex No 270 MLH (an annex that the tenant of a professionally used property has to attach) as soon as possible.

Belgium will implement international agreements on a digital tax (pillar 1). That way, large digital multinationals will be taxable even if they have no physical presence in Belgium.

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