A Guide To Securing Residence in Belgium
For entrepreneurs, self-employed individuals and investors who are not EU citizens, Belgium offers a relatively easy path to resident status and eventually to acquiring Belgian citizenship after five years of residence.
Residence Permits For Investors
Leaving aside reasons for obtaining residency and/or citizenship based on family ties with Belgium (e.g. marriage to a Belgian national, being born in Belgium or to Belgian parents), most residence applications concern persons who wish to establish business ties with the country. In these cases, applications for work permits and/or professional cards must be considered before it is possible to apply for a residence permit. In most cases, residence and citizenship can easily be extended to a spouse and children.
Non-EU citizens normally submit a long-stay visa application. All applications for residence permits are subject to case-by-case approval by the government. It is therefore of the utmost importance that an application is thoroughly prepared.
In principle, for the first three years, residence permits are issued on an annually renewable basis. Subsequently, an indefinite permit can be obtained.
The BRP Belgium Residence Program (BRP) is a fixed-fee service package offered by Haskew Law to non-EU citizens who are interested in obtaining a residence permit quickly and with minimal effort. By drawing on an extensive network of advisors and high-level contacts, we can offer you assistance in all administrative and procedural matters regarding your residence permit application, personal and corporate taxation as well as business opportunities. We specialise in providing a tailor-made service package in which every aspect of your personal situation is taken into account, and also offer an all-round service.
Depending on your individual circumstances, citizenship may be obtained after five years of legal residence in Belgium. This is your legal right, by means of a declaration, if fulfilling certain criteria. After 10 years of legal residence, a resident acquires the same right to become a Belgian citizen with even fewer conditions to comply with. Family reunion procedures are relatively straightforward.
As Belgium is one of the founding members of the European Union with a sound financial and legal climate, Belgian nationals are generally welcomed all over the world. Belgian/EU citizenship gives you the right of establishment in all EU member states as well as in Switzerland.
As the country is within the EU and the Schengen zone, a Belgian residence permit allows citizens whose passport normally requires a visa to enter this zone to travel anywhere within it without the need for a visa.
Once citizenship has been granted, a Belgian passport will allow visa-free travel to a large number of countries, including the United States. Indeed, a Belgium passport is one of the best travel documents in the world.
Corporate Taxation in Belgium
Belgium's corporate taxation system has been revised in recent years and is very much in line with the country's reputation as one of Europe's favourite holding company jurisdictions. Belgium has an extensive network of treaties with over 80 countries designed to avoid double taxation.
National Interest Deduction - a Unique Innovation
All companies subject to Belgian corporate tax are allowed to deduct a percentage of the interest on their adjusted equity from their taxable income, in order to mitigate the imbalance between equity and debt financing (notional interest deduction, or NID). NID does not discriminate between companies, is fully compliant with existing Belgian and EU laws, and assures legal certainty for investors.
The Belgium Hong-Kong Tax Treaty
The Belgium Hong-Kong tax treaty is the first OECD tax treaty entered into by Hong Kong, as well as the first Double Tax Treaty entered into with Hong Kong by any EU state. It creates unique opportunities for both Asia-EU and EU-Asia investments, with Belgium acting as a key financial portal.
Key Advantages of Belgium's Corporate Tax Environment
- One of Europe's favourite jurisdictions for holdings and headquarters
- Attractive corporate tax and tax ruling system
- National Interest Deduction for companies
- Tax treaties with over 80 countries, including Hong Kong
- Interest payments are 100% tax-deductible
- No taxation on capital gains on shares
We are a resource and complement to other consulting and law firms. Our Antwerp office is at your disposal to assist your company in obtaining specialist advice on how to apply the unique Belgian tax advantages and select a company structure adapted to your business sector and international interests.
Personal Taxation in Belgium
According to Belgian law and regulations, your worldwide private income is only taxable if you actually reside in Belgium. In most cases, your income can be structured in a favourable way. On top of that, some important exceptions apply, such as no tax on capital gains.
Appropriate tax planning gives you a number of important tax advantages. In some cases, income earned outside Belgium is not taxable at all. There are an extensive number of treaties with over 80 countries designed to avoid double taxation.
Main Tax Benefits for a Private Person resident in Belgium
The following are the key benefits of tax residence in Belgium:
- No tax on capital gains
- No wealth or net worth withholding taxes
- Maximum tax on dividends of 15% to 25%, depending on type of shares
- No tax on surplus value of (private) real estate, when owned for a minimum of five years
- 0-3% taxation on gifts (achievable with appropriate tax planning)
- The possibility of paying no inheritance tax (with appropriate tax planning)
- Extensive treaties to avoid double taxation
- In some cases, income earned outside Belgium not taxable at all
Special Regulations for Key Managers
Special regulations apply to key managers and directors, who are treated as foreigners resident in Belgium and are only taxed on income actually earned within the country.
Personal Tax Advice essential
To benefit fully from the favourable opportunities offered by Belgium to affluent residents, especially in the case of an international income base, it is essential to have access to highly specialised advice in order to optimise your tax planning.
More about Belgium
Rich History and Culture
Belgium is steeped in history, and almost every town and city has Gothic and Baroque churches overshadowing historic market squares. Museums abound, showing the glory of the past. But Belgium is also home to modern art, avant-garde design, internationally renowned opera, theatre and dance groups.
On the lighter side of life, it fully deserves its reputation as the home of "Burgundian" living. Food and drink are taken seriously in Belgium and go far beyond the famous chocolates, waffles, and over 600 kinds of beer. A wide range of cafés and restaurants serving excellent cuisine is available to suit every mood.
The major cities, especially Brussels and Antwerp, have superb shopping areas where luxury goods from all over the world are available.
Wide Choice of Housing
Despite the high population density and a high degree of urbanization, there is a wide choice of housing, ranging from opulent townhouses and apartments to stylish villas in affluent rural and suburban communities. Real estate prices are more than reasonable in an international comparison.
High standard of Education and Healthcare
Families having their principal residence in Belgium can rely on a high standard of education, including a wide choice of international schools. Belgian universities are easily accessible and participate in European and international student-exchange programs. Healthcare is also among the best in the world.
Thanks to these high educational standards, most Belgians are multilingual, thus facilitating both business and personal contacts.
International Business Environment
Brussels, home to a multitude of international businesses, EU institutions and NATO; and Antwerp, which hosts many port-related businesses as well as over 1,500 international diamond firms; have a particular tradition of welcoming a high proportion of foreign nationals in key positions, a fact which is reflected in their cultural and social life.
We offer assistance in this area and provide personalised tax planning by drawing on an extensive network of Belgian and international specialists.
Formation of a Belgian Limited Liability Company
Belgium knows two main types of limited liability companies. Other company types exist but are not that often used in our industry. A public limited liability company (NV/SA) is typically used for companies that engage in a lot of transactions and that are mainly set up from a financial point of view while a private limited liability company (BVBA/SPRL) is most of the times set up from a more personal point of view.
We aim to provide you with an overview of the steps to be taken to incorporate a Belgian
the main differences between an NV/SA and a BVBA/SPRL, the annual filing requirements and the services rendered by Haskew Law.
Steps to be taken in respect of the incorporation
1) Opening of a blocked bank account with a Belgian bank
Haskew Law has excellent contacts with most Belgian banks which can speed up the process of opening a bank account substantially. Once the bank account has been opened, the funds representing the future capital of the company need to be deposited into this account. Upon receipt of the funds, the bank will block the funds on the account and will issue a certificate to the notary that confirms receipt of the capital.
2) Preparation of a financial plan in Dutch of French
This financial plan needs to contain a detailed overview of the financial situation of the company for the first two years. If the company is declared bankrupt within the first three years after its incorporation, the financial plan will be provided by the notary to the court that will use the plan to evaluate whether the company’s share capital was manifestly insufficient for the normal exercise of the planned activities. If this is indeed the case, the founding shareholders will be held personally liable for the company’s debts.
Haskew Law can provide a template of a financial plan that automatically translates from English to Dutch or French. In addition, if requested, we perform a review of the financial plan
3) Meeting in front of a Belgian notary
A Belgian company is incorporated by notary deed. In this respect, proxies will need to be signed by the shareholders on the basis of which Haskew Law will be able to represent the latter before the notary. An overview of the information that needs to be provided to the notary can be found below under the heading ‘Information required in respect of the incorporation of the company’. Once the notary deed is signed, the notary will issue a certificate to the bank on the basis of which the funds in the blocked bank account will be released and transferred to the current account. Once the notary deed is signed, the notary will file the deed with the Commercial Court and the company will have legal personality.
4) Registration with the Crossroads Bank for Enterprises (KBO/BCE)
In this respect three approaches can be taken:
i. A declaration of honour is signed by which the Belgian company declares that it is not a small or medium-sized company.
ii. A declaration of honour is signed by which one of the shareholders of the Belgian company (that owns at least 25% of the company’s capital) declares that it is not a small or medium-sized company.)
iii. One of the managers/directors of the Belgian company provides a diploma that evidences basic knowledge of company management. In case this is not a Belgian diploma, the Ministry of Education needs to provide a declaration of equivalence.
Haskew Law assist with the preparation of the declaration on honour or in case one of the Haskew Law employees has been appointed as manager/director of the company, the registration can take place on the basis of the diploma of the relevant employee.
Depending on the activities of the Belgian company, different registrations such as a VAT registration might have to take place Haskew Law assist with the necessary registrations and take care of VAT compliance as well.
Affiliation with the social security Affiliation for social security is mandatory even if the company does not employ any personnel. Affiliation is done automatically upon incorporation.
Information required in respect of the incorporation
5) LEGAL FORM:
Please specify if you would like to incorporate a public limited liability company (NV/SA) or a private limited liability company (BVBA/SPRL).
A) COMPANY NAME:
This name needs to be different from the name of any other existing Belgian company.
In addition, the selected name cannot lead to confusion with the names of other Belgian companies.
B) LANGUAGE OF THE COMPANY:
Please select Dutch or French.
C) REGISTERED OFFICE OF THE COMPANY:
Haskew Law assist is securing a registered office address.
D) OBJECT OF THE COMPANY:
Please provide us with a clear description of the activities the Belgian company plans to undertake.
E) SHAREHOLDERS OF THE COMPANY:
An NV/SA needs at least two shareholders. A BVBA/SPRL only needs one shareholder. If a legal entity is appointed as the sole shareholder of a BVBA/SPRL, it will be jointly and severally liable for any and all debts and liabilities of the BVBA/SPRL. Please enclose a copy of the passport of the shareholders or of the articles of association of the shareholder in case this is a legal entity, as well as a recent excerpt of the trade registry proving the legal representatives of the shareholder.
f) SHARE CAPITAL OF THE COMPANY:
A BVBA/SPRL needs a minimum share capital of € 18.550.
An NV/SA needs a minimum capital of € 61.500.
G) NUMBER OF SHARES AND ALLOCATION TO EACH SHAREHOLDER:
H) NOMINAL VALUE OF THE SHARES (IF ANY):
I) FINANCIAL YEAR END:
J) CLOSING DATE OF THE FIRST FINANCIAL YEAR:
K) DATE OF THE ANNUAL GENERAL MEETING OF SHAREHOLDERS
Needs to take place within 6 months after the closing of the financial year.
L) NAME, PERSONAL ADDRESS, DATE OF BIRTH OF THE DIRECTORS / MANAGERS:
This needs at least 1 manager. An NV/SA needs at least 2 directors (3 in case there are more than 2 shareholders). Please enclose a copy of their passport and evidence of their address of residence.
M) PERIOD OF TIME FOR WHICH THE DIRECTORS / MANAGERS are appointed:
For a BVBA/NV this is standard an indefinite period of time. For an NV/SA is the maximum period six years.
N) SIGNATURE AUTHORITY:
Please mention if this will be singly or jointly (or other specific instructions)
O) REMUNERATION OF THE DIRECTORS / MANAGERS:
Please mention whether the directors will be remunerated.
P) MANAGING DIRECTOR:
For an NV/SA please mention if there will be a managing director and provide us with the name.
Please mention if an auditor will be appointed and provide us with his name, address and fees. It is mandatory to appoint an auditor for a Belgian company in case two of the following criteria are exceeded:
1. average personnel: 50
2. annual turnover before tax: € 7.300.000
3. Balance total: € 3.650.000
If the company employs more than 100 persons it will automatically need to appoint an auditor. If a company is part of a group that has the obligation to publish consolidated accounts, these criteria need to be calculated on a consolidated basis. For a company that is to be incorporated these criteria need to be estimated. It is possible to incorporate the company without an auditor. If the company, however, estimates that the criteria will be exceeded, the auditor has to be appointed before the end of the first financial year.
R) BANK ACCOUNT
Please provide us with the name, address and account number. If no bank account has been opened, please indicate if you would like Haskew Law to assist you with the opening of the account.
S) FINANCIAL PLAN
This financial plan needs to contain a detailed overview of the financial situation of the company for the first two years. If the company is declared bankrupt within the first three years of its incorporation, the financial plan will be provided to the court that will use the plan to evaluate whether the company’s share capital was manifestly insufficient for the normal exercise of the planned activities. If this is indeed the case, the founding shareholders will be held personally liable for the company’s debts. Main differences between an NV/SA and a BVBA/SPRL NV/SA BVBA/SPRL
Minimum share capital € 61.500 € 18.550 Minimum paid-up capital Minimum € 61.500 and:
-25% fully paid up on each share in case of a contribution in cash (in case the capital is higher than € 61.500)
-25% fully paid up on each share representing a contribution in kind in case the capital is higher than € 61.500 (and fully paid up within five years after the incorporation in case of a contribution in kind)
Minimum € 6.200 of which:
- fully paid up in case of a contribution in cash
- fully paid up in case of a contribution in kind (if the company only has one shareholder, the minimum capital to be paid up is € 12.400)
Transfer of shares Free (subject to restrictions in the articles of association)
Restrictions apply if the shares have not been fully paid up. Approval from the other shareholders is required prior to a transfer of shares (subject to restrictions in the articles of association)
A number of shareholders Minimum two shareholders Minimum one shareholder The limited liability no longer applies if:
- A sole shareholder is an individual person that is also the sole shareholder in another BVBA/SPRL
- The sole shareholder is a company
Number of directors/managers In general minimum three directors
If the company only has two shareholders, two directors are sufficient It is possible to delegate the daily management to a managing director Directors can be appointed for a maximum period of six years. Minimum of one manager can be appointed for an indefinite period of time dividend distributions can be distributed:
- Annual dividend
- Interim dividend
- Intermediary dividend
- Annual dividend
- Intermediary dividend
Annual filing requirements
1) An annual meeting of shareholders and board of directors/managers:
The annual general meeting (AGM) of shareholders is held on a specified date once every year, as fixed in the articles of association.
Key issues discussed at the AGM include approval of the annual report of the board of directors / managers, approval of the annual accounts, approval of any special reports, approval of the report of the auditor (if any), discharge of the directors/managers/auditor, appropriation of the results of the financial year. The AGM is preceded by a meeting of the board of directors/managers.
2) Financial statements:
After their approval by the company’s shareholders, the financial statements of Belgian companies should be filed with the National Bank of Belgium. In some cases, it is mandatory to publish quarterly financial statements. The annual financial statements need to be filed with the National Bank of Belgium at the latest one month after their approval by the AGM and maximum seven months after the closing of the financial year.
3) Social balance sheet / other filings:
Depending on the activities of the branch a social balance sheet or other returns such as VAT-returns or withholding tax returns need to be prepared.
4) Corporate income tax return:
On the basis of the financial statements that have been filed with the National Bank of Belgium, a corporate income tax return needs to be prepared. Fee schedule Haskew Law charges a fixed fee of € 2.900 (exclusive of VAT) for the following services in respect of the incorporation:
a) Opening of the bank account and obtain the bank certificate;
b) Provision of a template for the financial plan and review of the financial plan;
c) Liaising with the notary and arrange for proxies to be signed;
d) Representation of the shareholders before the notary and arrange for the release of the funds;
e) Registration with the Crossroads Bank for Enterprises;
Our fee does not include third party fees such as the invoice of the notary and the invoice of the Crossroads Bank for Enterprises.In addition, our fee does not include VAT registration or any translations (except for an English translation of the proxies for the incorporation). If required a separate fee proposal can be prepared in this respect.
In addition to the incorporation of the company, Haskew Law can assist with the following on-going services:
f) Preparation and filing of the financial statements with the National Bank of Belgium;
g) Preparation of specific reporting in Belgian GAAP, US GAAP or IFRS in our own accounting system or on the basis of a pre-defined format or in a system requested by the client;
h) Preparation and filing of the corporate income tax return, specific annexes and commission fee forms;
i) Assistance with the filing of the social balance sheet;
j) VAT-registration and full VAT compliance (VAT-returns, annual listing etc.);
k) Assistance with all kinds of corporate changes such as replacements of directors, capital movements etc.;
l) Payroll services;
m) Provision of a registered office;
n) Directorship services.
Our fees for the above-mentioned services will vary depending on the complexity of the work and will be charged on a time spent basis or on the basis of a fixed fee to be determined upfront.
Invest in Belgium
Name: Belgium investment opportunities
Description: Safe, part of the E.U, stable economy and welcoming to foreign investment from people who also want to secure permanent residency. Belgium offers a great opportunity to emigrate to the heart of the E.U for investors who are looking for a low risk destination. Others should also be considered, before investing.