General Overview of Tax Measures – Programme Law of 18 July 2025
On Tuesday, 29 July 2025, the Programme Law of 18 July 2025 was officially published in the Belgian Official Gazette. This date is significant, as a number of tax-related provisions come into force from that moment onward. Below is an overview of the measures, presented in a shuffled order.
VVPRbis Scheme
The reduced withholding tax rate of 20% on dividends distributed in the second financial year after a capital contribution remains applicable only for contributions made up to and including 31 December 2025.
Temporary Extension of Relance Overtime
The exemption for relance overtime (up to 120 voluntary extra hours exempt from overtime pay, social security contributions, and wage withholding tax) is extended until 31 December 2025.
Originally valid until 30 June 2025. This is an extension, not an expansion.
Withholding Tax – Stricter Conditions for Foreign Shareholders
The so-called ‘Tate & Lyle exemption’ now only applies if the shares are considered financial fixed assets.
Small companies are exempt from this new condition.
Applies to dividends granted or paid as from 29 July 2025.
VAT Measures
Fossil-fuel heating systems are excluded from the 6% VAT rate as of 29 July 2025.
For demolition and reconstruction of homes, property developers can still apply the 6% VAT rate, provided:
Stricter conditions apply (max. living area reduced to 175 m² from 200 m²).
Effective from 1 July 2025 (administrative tolerance decision dated 10 July 2025).
Exit Tax
A corporate relocation abroad is treated as a deemed liquidation.
Shareholders are considered to have received a liquidation dividend.
This provision applies to relocations from 29 July 2025 onwards.
Liquidation Reserve
For reserves built up before 1 January 2026:
Dividends may be distributed after 3 years at 6.5% withholding tax or after 5 years at 5%.
As of 29 July 2025, such 3-year distributions become possible.
For reserves formed from 1 January 2026:
Only the 6.5% rate after 3 years remains applicable.
The 5% rate after 5 years is no longer available.
Securities Tax
The anti-abuse clause for the securities tax in case of demergers and restructurings is tightened.
Effective as of 29 July 2025.
Temporary Extension of Overtime with Premium
The favourable tax regime for overtime hours with legal surcharge (reduced wage withholding for employers and tax credit for employees) remains in place.
The annual cap of 180 hours remains unchanged.
The extension is valid until 31 December 2025 (previously until 30 June 2025).
Dividends Received Deduction (DRD): Stricter Conditions (as of assessment year 2026)
For large companies, the participation must qualify as a financial fixed asset, specifically:
Participation in affiliated entities;
Participation with a structural link;
Other durable participations (i.e., not merely investments).
Small and medium-sized enterprises (SMEs) are exempt from this additional requirement.
Taxation of Carried Interest
The tax rate is reduced from 30% to 25%.
Applies to all carried interest granted or paid as of 29 July 2025.
Regularisation
Tax and social regularisation becomes possible again as of 29 July 2025.
Air Travel Tax
The boarding tax rate is increased as of 29 July 2025.
Tax Increase Waiver
In the case of a first offence committed in good faith, no tax increase will apply to assessments established from 29 July 2025 onwards.
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