The amount of Belgian withholding taxes is based on the withholding income tax scales published in a Royal Decree. The Belgian income tax code foresees several exemptions (overtime, research and development, night and shift work,…) with respect to the remittance of Belgian withholding taxes.
In this respect, it should be noted that the Belgian tax authorities are increasingly performing tax audits focussing on the correct application of the partial exemption of remittance of Belgian withholding taxes. Although we notice that these audits mainly focus on the partial exemption of remittance of Belgian withholding taxes in the context of research and development, the other exemptions are targeted as well.
The partial exemption of remittance of Belgian withholding taxes may have been a substantial saving in the hands of the company. However, in case of a (partial) refusal as a result of a tax audit, this may result in significant additional costs for the company.
If you have received a request for information from the authorities and you would like assistance on the matter, or would have further questions in this respect, please do not hesitate to contact Peter Vansteenkiste (+32 9 268 83 44) or Kim Meerschman (+32 9 268 83 01).