Changes regarding the research and development withholding tax exemption


Recently, a new circular letter was issued stating crucial changes regarding the withholding tax exemption for research and development projects and programs. These changes relate to the notification requirements and applicability of the exemption.

Until 31 July 2023, the current administrative position will remain in effect. This means that research and development projects and programs can be notified to Belspo after the start date of the project or program. This position allows companies to adapt their internal procedures to these new requirements.

What changes?

From 1 August 2023, however, a stricter position will be adopted based on a recent Supreme Court decision. This means that notification to Belspo is mandatory before the start date of the research or development project or program. The Supreme Court stressed that this requirement stems from the relevant tax legislation.

It is crucial to be aware of these changes as they affect the application of the withholding tax exemption. As of 1 August 2023, only research and development projects and programs that have been notified before their start date will be eligible. This applies to remuneration of eligible personnel working in projects or programs that have not yet started. The notification must contain all mandatory information as specified in Article 275/3, § 3, paragraph 4 of the Income Tax Code 1992.

It is important to emphasize that ongoing research and development projects and programs that have not been notified with all required data by 1 August 2023, cannot enjoy an exemption from withholding tax. The notification requirement before the commencement date applies to all notifications made from 1 August 202

For projects and programs properly notified before 1 August 2023, nothing will change. These notifications will remain valid until the end of the program or project, even if they occurred after the project start date. The current administrative position will continue to apply in this case.


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