Perspectives

COVID-19 Business Tax

Business tax reliefs and concerns

Business tax relief measures taken by the Federal Government and by the Regional Authorities

Federal Government

To help companies facing financial difficulties due to the COVID-19 crisis, the Belgian Federal Government introduced an automatic extension of due dates for a number of tax reporting obligations and tax payments in the near future (Dutch | French).

Corporate Income Tax Prepayments

The government has decided to increase the CIT prepayment credits for the third and fourth quarter. 

With this measure, postponing CIT prepayments is less detrimental.

The below table shows the amended credits for prepayments. As mentioned, the percentages of third and fourth quarters have been increased (unless there is a dividend payment):

 

CIT credits (no dividend distribution)

CIT credits (but dividend distribution)

Q1

9%

9%

Q2

7.5%

7.5%

Q3

6.75%

6%

Q4

5.25%

4.5%

The measure is intended for companies with liquidity problems. Therefore, this does not apply to companies that:

  • buy back own shares or perform a capital reduction;
  • pay or declare dividends between 12 March 2020 and 31 December 2020.

The increase for insufficient prepayments as well as the due dates of the prepayments remain unchanged.

Tax returns

Tax returns with a due date between 16 March and 30 April are granted an automatic extension until 30 April. This applies to corporate income tax, legal entities tax and non-resident tax returns.

Deferral of payment

Taxes assessed from 12 March 2020 onwards (and related to tax year 2019) are granted an automatic extension of two months.

No penalties or late payment interest will be due. This applies to corporate income tax, legal entities tax, and non-resident tax. It should be noted that these measures can be applied regardless of whether company activities are negatively affected by COVID-19.

For taxes that have been assessed before 12 March 2020, the taxpayers can file a request for other tax support measures (see below).

Payroll withholding tax

An automatic extension for payment has been granted, depending on the taxable period:

  • Monthly February return: until 13 May
  • Monthly March return and 2020/Q1 quarterly return: until 15 June
  • Monthy April return: until 15 July

For tax that has become due before 12 March, taxpayers can still file a request for other tax support measures (see below).

Other tax relief measures

Deferral of tax payments

All Belgian registered businesses, which are able to demonstrate that they are negatively affected by the COVID-19 outbreak, can request payment deferral. This applies to the following taxes: corporate income tax, legal entities tax, payroll withholding tax, and VAT.

Affected persons can request aid in the form of:

  • payment plan in arrears,
  • exemption from late payment interest and
  • remission of fines for non-payment.

Taxpayers planning to apply for these relief measures are requested to submit a form (one per debt) that should be sent by mail or letter to the competent regional centre (Regionaal Invorderingscentrum / Centre régional de Recouvrement). More info about the procedure to be followed can be found on the website of the FOD/SPF Finance (Dutch | French). Requests need to be filed by 30 June at the latest.

Costs relating to donations

The Belgian Federal government announced that companies will be allowed to deduct the costs for donations of medical devices and protective gear for health care workers (such as gloves, medical masks, mouth covers etc.) to health care institutions. The measure applies to donations given in kind from 1 March to 30 June 2020.

Donations in scope of this measure will also not be subject to provisions regarding the granting of abnormal or benevolent advantages provided by the Belgian tax code.

Additional information can be found in Circular Letter 2020/C/46 (Dutch | French).

Regional Authorities

Flemish Region

The Flemish Government has decided to delay the issuance of tax assessments for the property tax until September. Normally, the property tax is assessed from May onwards.

In addition, for the assessment year 2020, companies will be granted a 4-month deferral of payment of the annual traffic tax.

Go to the COVID-19 Subsidies & Grants web page to find out which other measures have been taken by the Flemish Region.

 

Walloon Region

Go to the COVID-19 Subsidies & Grants web page to find out which measures have been taken by the Walloon Region.

 

Brussels Region

The Brussels Government has decided to cancel the city tax for the first half of 2020.

Go to the COVID-19 Subsidies & Grants web page to find out which measures have been taken by the Brussels Region. 

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