On 22 July 2026, the Belgian tax authorities published Circular 2026/C/74 providing detailed guidance on the new capital gains tax on financial assets. The tax applies within the personal income tax framework (not corporate tax or non-resident tax) and is effective from 1 January 2026. It targets gains realised outside any professional activity, within normal management of private assets, and only upon transfers for valuable consideration. Historical gains accrued before 2026 are protected through a “reference date” mechanism (value on 31.12.2025).
The circular letter contains several important clarifications for the private equity industry. We briefly summarize the key takeaways below.
Three regimes at a glance
The newly introduced capital gains tax provides for three regimes to tax capital gains realised after 1 January 2026:
Key takeaways for private equity
Roll-over equity and ‘skin in the game’ generally not considered as internal capital gain
One of the most important clarifications concerns (private equity) structures where sellers reinvest into the acquisition vehicle.
The circular letter confirms that the internal gain regime (Type A) only applies where the seller transfers shares to a company that he or she controls alone or together with close family members. This regime should generally not apply in a private equity transaction where the seller reinvests in a (holding) company alongside the private equity. Indeed, for a certain period following the acquisition, the shareholder continues to exercise direct or indirect control, jointly with a third party.
The circular letter also confirms that typical governance provisions in private equity structures, such as veto rights, arrangements regarding the company’s strategic direction, board nomination rights, etc do not, in themselves, constitute evidence of control. Also in case of a management buy-out, the contractual arrangements will, in principle, not be decisive. For purposes of the new capital gains tax provision, ‘control’ must be assessed in application of the Belgian Companies Code.
Share-for-share contributions: roll-over regime remains available
The circular letter confirms that gains realized on share-for-share contributions continue to benefit from the specific roll-over regime regardless of whether the contributor controls the receiving entity or not. This also applies to contributions in civil partnerships.
The exemption only defers taxation: the historical acquisition value of the contributed shares is preserved for any later disposal.
Civil partnerships remain a viable tool to pool management investments if properly structured
The circular letter provides welcome guidance on the application of the new capital gains tax to civil partnerships (‘maatschap’), which is often used in private equity structures to pool management investments. The tax only applies where a realisation event occurs. The mere creation or termination of a civil partnership does not in itself trigger capital gains taxation. Likewise, the contribution of financial assets to an undivided ownership arrangement should not constitute a taxable event, provided that it does not result in an implicit exchange of one financial asset for another.
The circular letter clarifies that there will always be an implicit exchange, and therefore a realisation event, where a new partner is admitted to a civil partnership during its existence. At that point, the underlying assets are effectively reallocated among the partners, resulting in a partial transfer of financial assets. However, no realisation event arises where two individuals jointly hold a shareholding in undivided ownership, each owning a 50% interest, and subsequently contribute those shares to a civil partnership without altering the relative proportion of their rights. In such circumstances, no implicit exchange of assets occurs.
Civil partnerships hence remain a viable tool to pool management investments, but sponsors and management teams should carefully assess any admission of new partners or restructuring of partnership interests, as such changes may constitute an implicit exchange of assets giving rise to capital gains taxation.
Clarification on substantial holding regime (‘type B’): shareholding structure may affect tax treatment
Taxpayers holding at least 20% of the shares benefit from a more preferential regime, with progressive rates and an exemption of EUR 1m (available once in 5 consecutive periods). The circular letter now clarifies that only shares count (not profit certificates / warrants / options) and only applies to directly held participations. The 20%-threshold is to be considered irrespective the class of shares. In case, for example, a company has issued A – B – C class of shares, the threshold is to be calculated based on all shares together (irrespective of their voting rights).
The circular letter explicitly confirms that the threshold needs to be calculated at the occasion of the transfer. In case one of the shareholders holds 20% of the shares and, following a capital increase, dilutes to 19% prior to the transfer, said shareholder will no longer benefit from the (more preferential) type B regime but instead will fall under the general type C regime.
As a result, the design and evolution of the shareholding structure in private equity-structures may have a substantial impact on Belgian private individual shareholders’ net returns upon exit and should be duly considered upon implementation and throughout the holding period.
Earn-outs: timing of taxation
The circular letter confirms that taxation is triggered when the relevant portion of the consideration becomes finally determined. As a result, where part of the purchase price is contingent upon future events, the taxation of that portion is deferred until the amount becomes certain and quantifiable. Importantly, the circular letter confirms that where the initial transfer qualifies for the substantial shareholding regime (Type B), that regime will continue to apply to the deferred earn-out payment. Earn-out payments relating to share transfers completed before the entry into force of the new regime on 1 January 2026 are outside the scope of the new capital gains tax.
Carried interest remains governed by the specific carried-interest rules
The circular letter reiterates that existing qualification and requalification rules continue to apply. Consequently, amounts falling within the scope of the carried interest rules are taxed under that specific regime rather than under the new capital gains tax.
Valuation remains key
The new capital gains tax applies to capital gains accrued after 1.1.2026. For unlisted assets, the base cost of the shares will be the higher of:
- (i) The value at which a financial asset has been disposed in 2025 between independent parties (or subscription price in case of a capital increase in 2025)
- (ii) The value from a valuation formula included in a contract or put option in force on Jan 1 2026
- (iii) the equity value of the company increased by 4 x EBITDA as per the last financial statements prior to January 1, 2026
- (iv) the value as determined by an auditor, who is not the statutory auditor, or an independent chartered accountant by December 31, 2026 at the latest)
- (v) Actual (documented) acquisition cost for disposals occurring up to December 31 2030
The circular letter does not provide any further guidance as to how to calculate the EBITDA formula, but the law refers to the formula used in Belgian tax law, which is based on standalone (unconsolidated) figures and does not allow for (commercial) normalizations.
As a result, performing a detailed valuation per 31 December 2025, which is signed off by an independent auditor or registered accountant remains a key action point (ultimately by 31 December 2027). Given the potentially significant tax impact, it is essential that the valuation is robust, well-supported and capable of withstanding scrutiny from a tax perspective.
For more information, please contact Nancy De Beule or Jolien Van Landeghem.
