Belgian Tax reform – Individuals – Personal income tax

Latest update: 18 December 2025

Draft law containing various provisions adopted by the Chamber

On 11 December 2025, the Chamber adopted the draft law providing various provisions. 

From an employer perspective, the main changes are as follows: 

•  Meal Vouchers: The maximum employer contribution to electronic meal vouchers increases from 6.91 EUR to 8.91 EUR. 

•  Hybrid Company Cars: In addition to the changes mentioned above, the definition of benefit in kind will be adapted to include ‘false hybrid cars’ as per the new standard. 

•  Expat Regime: An un-capped tax–free allowance within the 35% limit of the total annual gross remuneration is introduced (the EUR 90.000 cap is removed). The base salary for activities performed in Belgium must at least be 70.000 EUR to be eligible. Changes will take effect retroactively from 1 January 2025. The amendments also introduce important transitional provisions. They apply retroactively to individuals commencing employment in Belgium from 1 January 2025, particularly those with gross salaries between EUR 70,000 and EUR 75,000, subject to other qualifying conditions. A dedicated catch-up window allows late applications within three months from the 10th day following the law’s publication in the Official Gazette.  

From a general income tax perspective, the new measures focus on several key areas: 

•  Hybrid Cars: Starting 1 January 2026, self-employed individuals will face full non-deductibility of fuel costs for hybrid cars acquired, leased or rented from that date. However, hybrid cars obtained between 1 July 2023 and 31 December 2025 will enjoy a transitional regime, allowing up to 75% deductibility based on CO2 emissions, for the duration of the car ownership by the same self-employed individual. Cars emitting a maximum of 50 gr CO2 can benefit from higher deductibility (but max. 100%). Electricity costs remain fully deductible, while fuel costs will gradually decrease to 0% by 2028 (AY 2029). For vehicles acquired from 1 January 2026, electricity costs will follow a degressive deductibility, except for those acquired before 1 January 2027, which remain at 100%. Other costs will be calculated using a formula, excluding fuel factors, with a ceiling applied. Cars acquired between 1 January 2026 and 1 January 2028 will have deductibility up to 75%, with higher rates for cars emitting less than 50 gr CO2. The definition of ‘false hybrid’ will now include cars emitting over 75 gr/km, based on the new Euro 6e-bis standard. 

•  Flexi-Jobs: The exemption increases from 12,000 EUR to 18,000 EUR starting income year 2025, with annual indexing. 

•  Dependents: The resource threshold for being considered a ‘dependent’ has been increased to 12,000 EUR. 

•  Loan Interest Deduction (for other real estates than the own dwelling): This deduction is abolished from fiscal year 2026, effective 1 January 2025. 

•  Alimony Payments: Deductibility will reduce gradually: 70% in 2025, 60% in 2026 and 50% by 2027. Payments outside the EEA are non-deductible, except for beneficiaries residing in Switzerland. 

•  Freeze of Tax Reductions or Deductions: Several amounts related to tax reductions or deductions will be frozen from 2025 until 2030. 

•  Tax Simplification: Various tax exemptions and reductions are abolished, including allowances for long-distance travel, domestic employee salary reductions, adoption expenses, legal protection insurance premiums, and employer contributions for private computer purchases. The tax reduction for gifts decreases from 45% to 30%. 

This law also provides for some tax procedure changes.  

These changes aim to reverse and simplify procedural reforms from 2022. Investigation and assessment periods will be as follows: 

•  3 years for standard tax returns (no changes). 

•  4 years for late and complex tax returns, further defined in the law. 

•  7 years in cases of fraud, applicable to both income tax and VAT (situation as it was before the reform of 2022). 

These changes apply from assessment year 2023.  

Additionally, the law provides: 

•  Broader access for designated officials to use CCP data for datamining and datamatching. 

•  Financial institutions must report balances of crypto-accounts and securities accounts. 

•  Direct access to CCP by officials in charge of tax on securities accounts in view of verifying the correct application of the provisions regarding this tax. Access by these officials is possible even if no indications of fraud are available and without prior notification to the taxpayer.

Program Law of 18 July 2025 (Official Gazette 29 July 2025)

On 17 July, the Chamber adopted a first set of tax measures. The Program law has still to be published in the Official Gazette.  The other measures included in the Easter agreement are part of a draft bill containing various provisions, which is currently under review at the Chamber. The main measures adopted are as follows:  

Carried Interest

The law introduces a new regime for individuals or related persons receiving carried interest from Belgian/foreign AIFs (alternative investment funds). The law defines the concept of “carried interest vehicle” and of “carried interest beneficiaries”. The income will be treated as investment income, taxed at a flat 25% rate (via withholding & income tax). The income that will be considered as “carried interest” can be the share of profits, dividends, capital gain, … after deduction of the acquisition value. The carried interest will not be reclassified as “professional income”. This measure will enter into force on the date of its publication in the MB/BS and will apply to income paid or attributed from this date. Carried interest vehicles being liquidated before the date of entry into force of the law will not be affected.

Liquidation reserve and VVPRbis regime

The law provides for an alignment of both regimes with, for the liquidation reserve, a reduced waiting period from 5 to 3 years and a new rate at 6,5%. The regime will depend on the date of creation of the reserve and the date of distribution. In this respect, note that the law provides for the possibility of distributing reserves created before January 1, 2026, at a rate of 6.5% if they have been held for a period of 3 to 5 years (provided that all other legal requirements are also met). For the VVPRbis regime, the rate of 20% applicable to dividends allocated or distributed during the second financial year after the cash contribution (made on 31 December 2025 at the latest) will gradually phase out. In respect of other cash contributions, the rate of 15% will be applicable to dividends distributed or allocated during the third financial year following the contribution or later. The changes regarding the liquidation reserve will apply to dividends attributed or paid from the date of the publication of this law in the Moniteur Belge/Belgisch Staatsblad (hereafter “MB/BS”). Those related to the VVPRbis regime will apply ten days after the publication of the law in the MB/BS.

Exit tax

This new tax introduces the concept of a “deemed dividend” (representing the latent capital gains) for shareholders when a company emigrates or restructures in a way that transfers assets abroad. Shareholders will be taxed on this deemed dividend as if they received an actual dividend, subject to applicable personal or corporate income tax rates. A tax credit mechanism will be available to prevent double taxation when these gains are eventually realised and distributed. The taxpayer will also be able to defer the tax payment. The company that transfers the assets must provide individual slips to shareholders. The new provisions will enter into force on the date of their publication in the MB/BS and apply to transactions referred to in art. 210, § 1er, 1er, 1°bis, or 4° ITC that take place from this date.

Tax on securities account

A new anti-abuse measure aiming to prevent taxpayers from circumventing the tax through artificial conversions or transfers of financial instruments is introduced. The new anti-abuse measure will enter into force on the date of its publication in the MB/BS and the first reporting obligation must be fulfilled by 31 December 2025 at the latest.

Tax procedure

The 10% tax increase for a first-time offense committed in good faith will be automatically waived. The good faith is presumed, except in case of an ex officio assessment (such as i.a. late tax return or absence of tax return). In case of an ex officio assessment, the taxpayer can still prove his good faith. This amendment is applicable for assessments enrolled as of the publication of this law in the MB/BS.