Unless a company pays its Belgian corporate income taxes due by means of timely advance tax payments during the financial year concerned, a surcharge is due on the final amount of Belgian corporate income tax due upon assessment.
If advance tax payments are made, credits – which can be offset against the surcharge – are granted at fixed percentages, depending on the timing of payment: the sooner the advance tax payment is made, the higher the tax credit. If the surcharge is higher than the credit for a given assessment year, the balance will always be due.
There are four due dates for making advance tax payments during each financial year. Advance tax payments can be made in quarterly instalments no later than the 10th day of the fourth, seventh and tenth month of the financial year and the 20th day of the last month of the financial year.
For assessment year 2021, the global surcharge is 6,75% (as was also applicable for assessment year 2020) and the first due date to make an advance tax payment for a financial year ending on 31 December 2020 is 10 April 2020.
Depending on the (forecasted) cash available within the company/group and the estimated taxable basis of assessment year 2021, it is highly advisable to consider making an advance tax payment in the first quarter. Such first quarter advance tax payment gives a credit of 9%. This means that a company should pay less advance tax payments as compared to paying in a later quarter, e.g. the fourth quarter only giving rise to 4,5%.
When calculating a company’s forecasted taxable basis for assessment year 2021, one should assess special transactions and exceptional events which may occur during the year, such as the impact of the Corona virus on its business/results. In addition, the impact of the last wave of the last tax reform should be evaluated as well. In this context, we refer to measures such as the decreased statutory tax rate, the impact of the EBITDA rules and the possibility to make use of tax consolidation.
We also draw your attention to the fact that -since 1 January 2019- the bank account number to transfer advance tax payments to has changed. All payments have to be transferred to the bank account with IBAN number BE61 6792 0022 9117 (BIC: PCHQ BEBB). The payment procedure including the structured communication to be used remains the same (even in case of a first advance tax payment). However, please note that in order to request for a refund, request for a transfer of advance tax payments to a subsequent assessment year or have an overview of the advance tax payments made in relation to a specific assessment year, the taxpayer needs to access the specific module on the MyMinFin platform (which requires a Belgian e-ID or a specific login).
Impact of the COVID-19
As a result of the COVID-19 crisis, the Belgian government has very recently introduced the possibility for companies to request for supportive financial measures. To the extent that companies are facing financial difficulties directly resulting from the coronavirus spread (to be demonstrated and subject to additional conditions), payment arrangements (such as the Belgian corporate taxes, VAT or Belgian professional withholding taxes) can be requested to the competent authorities by filing a formal request prior to 30 June 2020.
How can we help?
Our experts are ready to assist you in:
- Computing and optimizing the advance tax payments to be made for assessment year 2021 taking into account the further roll-out of the tax reform (such as the interest limitation deduction or the tax consolidation regime); and/or
- Providing further guidance on how to access/use the specific module on the MyMinFin platform; and/or
- Analysing the impact of the supportive financial measures resulting from the COVID-19 and, if applicable, we can also assist with the actual preparation and filing of the formal request.
Please feel free contact your regular contact person to discuss the above. He/she will be happy to support you or refer you to one of our specialists if needed.