Advice Belgian ruling commission on use of GAAR in reorganizations


Since the introduction of the new general anti abuse (section 344 Belgian Income Tax Code) provision in Belgium, there was uncertainty on how the latter interacts with the existing specific anti-abuse provision in place for reorganizations (section 183bis Belgian Income Tax Code)

Recently the ruling commission issued a new advice with their view on what to do if both anti-abuse provisions interact.

They highlighted two specific situations namely:

  1. A tax neutral reorganization with an immediate or subsequent transfer of shares; and
  2. Transactions implemented prior to a restructuring (eg. sale of shares, increased dividends, contributions, …) with tax neutral reorganizations.

It appears that in any ruling covering these anti-abuse provisions, the ruling commission will list an explicit caveat in the ruling decision on the above 2 topics.

As a consequence of this new advice, we expect that clients will need to file more amendments if the facts and/or intentions stated in their ruling decision change afterwards (even after 3 years), to ascertain the Belgian tax treatment of any transaction.

This might lead to a more closely follow up and interaction with the ruling commission, which, although not identical, has a tendency to become similar to what is currently installed in other European countries (eg. ‘horizontaal toezicht’ in The Netherlands’).

You can read the entire advice in French or Dutch.