Benefit in kind for free housing granted by a company ruled unconstitutional by two Courts of appeal


When a company puts a housing at the disposal of one of its directors or employees, the beneficiary is taxed on a benefit in kind. This benefit is assessed on a lump-sum basis. The evaluation depends on whether the housing is given by an individual (100/60 x indexed cadastral income) or by a company (100/60 x indexed cadastral income x 3,8 if the cadastral income is higher than EUR 745 – 1,25 if the cadastral income is lower than EUR 745). The amount of the benefit is kind is consequently much higher when it is granted by a company.

The Courts of appeal of Ghent and Antwerp recently ruled that this tax system is not compliant with the principle of equal treatment by lack of objective and reasonable justification. The current tax treatment is therefore strained by this case law. However, the provision of the Royal Decree governing the evaluation of the benefit in kind still exists and will continue to be applied by the tax authorities. We expect that the tax authorities will lodge an appeal in Cassation or make adjustments to the current regulation.

For any questions, don’t hesitate to contact your local PwC contact.