News articles written by Nancy De Beule

Tax neutral merger possible in Belgium in case of negative accounting net equity

30 September 2019

When a merger is performed between two Belgian legal entities whereby the acquired company has a negative accounting net equity, the question pops-up whether such merger is possible and feasible to perform tax-free. Given that Belgian law does not explicitly require a positive net equity, it can be assumed a contrario that a merger should

Limitation of tax losses in case of partial demerger

18 June 2019

A partial demerger is a transaction whereby part of the assets and liabilities of the partially demerged company are transferred to another (acquiring) company, which (in principle) issues shares to the parent company of the partially demerged company. In case of a tax-neutral partial demerger, the carried forward tax losses of the partially demerged company

Asymmetric debt-equity swap: Court of Appeal rules in favor of tax authorities

9 April 2019

On 26 February 2019, the Court of Appeal of Ghent ruled on the income tax treatment of an asymmetric debt-equity swap. The Court decided that both the contributing company and receiving company have to apply the same value. In the case at hand, a company A had a receivable of 1000 on its subsidiary B,

Positive ruling on deductibility of interest costs on loans contracted in order to finance capital reduction in case of an ‘over-capitalised’ company

12 March 2019

The Belgian ruling office recently published a positive decision deciding that interest costs related to the intercompany loan are deductible for tax purposes since the costs are borne by the company with the purpose to preserve or generate taxable income. In the case at hand, a factoring company with ‘an excessive amount of equity’ is

Negative ruling highlights pitfalls of pre-deal carve-outs through partial demergers

29 January 2019

In a recent decision, the Belgian ruling office rejected a pre-deal carve-out of real estate through a tax neutral partial demerger followed by a tax exempt transfer of shares of the operating company. Though the ruling does not particularly divulge novel views, it has the merit of highlighting common pitfalls related to these type of