On 24 June 2014, the tax administration published a Practice Note on its website related to the 2013 modification of the withholding tax regime for Belgian-sourced dividends received by Belgian-regulated investment companies.
The note provides comments on the tax regime both before and after the change in law introduced by the Act of 30 July 2013 (art. 185bis, §2 (2) of the BITC).
Of particular relevance is that for the period prior to assessment year 2014, the tax administration specifies that the withholding taxes levied on Belgian-regulated investment companies against their Belgian-sourced dividends – which were in principle offset against the Belgian corporate income tax due and possibly refunded – should have been reported as disallowed expenses in their corporate income tax returns (art. 198, §1, (1) of the BITC) which may potentially lead to corporate income tax being due.
We recommend that Belgian-regulated investment companies and asset managers take a close look at this interpretation by the tax administration and verify, on a case-by-case basis, whether or not it might have practical consequences.
We of course remain at your disposal to discuss this matter with you.
French version of the practice note: Circulaire AGFisc N° 25/2014 (n° Ci.RH.421/630.783) dd. 23.06.2014
Dutch version of the practice note: Circulaire AAFisc Nr. 25/2014 (nr. Ci.RH.421/630.783) dd. 23.06.2014