Good faith presumption: new opportunities to challenge 10% tax increases

The Belgian Constitutional Court has delivered an important judgment that may benefit taxpayers involved in ongoing income tax disputes.

In its judgment of 18 June 2026 (No. 76/2026), the Court ruled that the new presumption of good faith for a first tax infringement does not only apply to tax assessments issued from 29 July 2025 onwards, but must also be applied to older assessments that are not yet final.

For many taxpayers, this creates an opportunity to challenge a previously imposed 10% tax increase and, in certain cases, also avoid the related tax deduction prohibition.

What has changed?

Since the Programme Law of 18 July 2025, taxpayers who commit a first tax infringement are presumed to have acted in good faith, unless the tax authorities can prove otherwise.

The practical consequence is straightforward: where the first infringement was committed in good faith, no 10% tax increase should be imposed.

Originally (according to the legislator), this favourable regime only applied to assessments enrolled from 29 July 2025. The Constitutional Court has now ruled that this limitation is incompatible with the principle that a more lenient penalty must also apply to pending cases.

Who can benefit?

The judgment is particularly relevant for taxpayers with ongoing income tax disputes, for example where:

• an administrative objection is still pending;
• judicial proceedings are ongoing; or
• the assessment has not yet become final.

Where a 10% tax increase was imposed for a first infringement, it may now be worthwhile to reassess whether the taxpayer can rely on the statutory presumption of good faith.

By contrast, final assessments that can no longer be challenged are, in principle, not affected by the judgment.

A broader financial impact than the tax increase alone

Successfully challenging a 10% tax increase may have consequences beyond the penalty itself. Under the Belgian corporate income tax rules, an effective tax increase of at least 10% may trigger the prohibition of using tax deductions (such as tax losses).

Consequently, if the 10% tax increase is successfully removed, the related deduction prohibition may also fall away, potentially resulting in a significantly lower overall tax burden.

What about ex officio assessments?

The judgment is less favourable for ex officio assessments. The Constitutional Court confirmed that the statutory presumption of good faith does not apply where the tax authorities have effectively raised an ex officio assessment (Article 351 ITC). The Court considered this distinction to be objectively justified and therefore not discriminatory.

This does not mean, however, that taxpayers have no defence. They remain free to demonstrate that they acted in good faith, and there may also be grounds to challenge the sanction based on the general principles of good administration, including the principle of proportionality and the duty to provide adequate reasons.

Recent Belgian case law illustrates this evolving approach. In a judgment of 1 April 2026, the Court of First Instance of Antwerp accepted that, although the 10% tax increase itself could remain, the deduction prohibition could nevertheless be set aside because its application was disproportionate in the specific circumstances of the case.

Practical recommendations

Taxpayers should consider reviewing their position where:

• a 10% income tax increase was imposed for a first infringement;
• the dispute is still pending before the tax authorities or the courts;
• the tax increase has triggered a prohibition of using tax deductions (such as tax losses); or
• an ex officio assessment may warrant a challenge based on proportionality or inadequate reasoning.

Given the potentially significant financial consequences, a reassessment of ongoing cases may prove worthwhile.

How can RSM help?

RSM can assist in assessing whether your case may benefit from this landmark judgment, including:

• reviewing pending administrative and judicial tax disputes;
• evaluating whether the presumption of good faith can be invoked;
• assessing opportunities to challenge the 10% tax increase and the resulting deduction prohibition;
• advising on arguments based on proportionality and good administration principles in ex officio assessment cases; and
• assisting with objection procedures.

If you would like to receive additional information on this matter or require tax assistance, the RSM Belgium Tax team is at your disposal at tax@rsmbelgium.be.