Belgian employment legislation and individual income tax is rapidly changing and becoming more complex while employment is happening on a much more global scale than before.
Therefore, expert advice is an absolute requirement to be able to navigate the legislative maze. Our tax and employer services specialists strive to collaborate with you to optimise the cost of employment for companies, while ensuring the highest possible net result for the individual; be it as independent or as employee. Considering the ever-increasing administrative burden of employing personnel in Belgium, our tax and employer services have a special focus on managing this process together with our clients.
1. IMMIGRATION FORMALITIES
Immigration plays a vital role in today’s global business environment. RSM provides specialist immigration advice to a wide range of clients and aids in the compliance requirements of its clients.
Based on your business needs, we will determine which solution is best in your specific case. RSM provides a hands-on approach to ensure your business can transfer the necessary employees to Belgium within the shortest possible timeframe.
2. RSM INTERPAY - PAYROLL MANAGEMENT AND COORDINATION
After the development of a remuneration policy comes the actual implementation in the monthly payroll of your employees.
Considering the complex nature of Belgian employment legislation and the various requirements imposed on employers, RSM has developed a specific approach to payroll management together with our clients.
RSM can handle your payroll from A to Z as if we were your internal HR department. If necessary, this assistance can be much more intensive than the service offered by regular payroll providers. Such intense guidance is ideal for companies with limited HR resources in Belgium or with limited knowledge of employment legislation.
RSM’s knowledgeable staff ensure legal compliance in Belgian payroll matters. We collect payroll instructions in the format desired by you, input them into payroll software, verify for internal and external compliance and issue the pay slips together with payment instructions. Pay slips can be provided directly to the employees if required. We can also inform your employees in Dutch, French or English.
RSM closely monitors all legislative changes which may have an impact on payroll, informing the employer if required and providing the necessary advice for implementation of the changes in the payroll.
3. TAX FORMALITIES
Working in Belgium requires compliance with various formalities. These formalities are mostly legal requirements such as the filing of annual personal income tax declarations. However, sometimes you may be able to take advantage of certain tax treatments, such as the special tax regime for foreign executives and specialists.
The specialists at RSM are aware of these formalities and can provide tax advice to ensure the practical compliance aspects are dealt with.
4. HR, SOCIAL AND LABOUR MATTERS
Our team have practical experience in Belgian employment law. With a combination of labour law and tax law knowledge, we will ensure that the solution offered has the highest possible value for your organisation. We can guide you through various labour law requirements and aid you in drafting company policies, work regulations and labour agreements.
5. SOCIAL SECURITY
Working in a cross-border context does not only have potential tax consequences, but also impacts social security. This can affect your employees’ pensions as well as disability and sickness allowances.
Within Europe, persons to whom the EU-Regulations apply are subject to the legislation of a single member state only. Usually, the legislation of the member state where the activity is carried out applies (“lex loci laboris”). As many deviations to this general rule exist, our specialists can offer guidance. In addition, we can aid with certain compliance matters such as the A1 certificate or certificate of coverage.
6. TAX ADVICE
The complex legislative landscape of Belgium offers a variety of cost saving opportunities. Together with the international treaties which bind countries, our specialists can offer tax advice on a wide range of remuneration techniques and salary structures. Examples include the implementation of a salary split, non-recurring result-tied bonus plans, R&D withholding tax exemption and equity incentives.
7. SPECIAL TAX REGIME FOR FOREIGN EXECUTIVES AND SPECIALISTS
The Belgian Tax Administration grants special tax concessions to non-Belgian executives and skilled employees who have been assigned temporarily to exercise an activity in Belgium. This is called the Special Tax Regime.
The Special Tax Regime has been created by the Belgian government to attract foreign multinational companies and R&D centres to stimulate economic growth and create new job opportunities.
The advantages of the special tax regime are tax-free allowances of up to EUR 11.250 per year (EUR 29.750 in some cases), exemption of all foreign business trips from personal income tax in Belgium, and treatment as a Belgian tax non-resident, even though you are living in Belgium.
RSM can help you request the Special Tax Regime, ensuring timely filing of the request itself with the Belgian tax authorities.
8. PERSONAL INCOME TAX DECLARATION
The 6th state reform and the associated regionalisation of taxes has further complicated Belgian tax rules. There is an annual requirement to complete a personal income tax declaration form, whether you are a Belgian tax resident or a non-resident. The annual tax declaration compares any tax withheld through payroll with the personal income tax rates. This determines whether an individual can recover money from the authorities or needs to pay in addition to what was already withheld.
RSM can provide tax advice to both private persons and companies to ease the burden related to the annual filing of the declaration form. Our assistance is highly tailored to your needs and ranges from an in-company presentation on Belgian personal income tax, workshops on specific topics, preparation of the entire tax declaration or face-to-face meetings to discuss any questions.
9. COSTS PROPER TO THE EMPLOYER
One of the obligations of an employer is to provide its employees with the required tools and materials for their work. Amounts which are a reimbursement of costs to be taken at charge by the employer are excluded from the concept of remuneration. It only concerns costs at charge of the employer resulting from the execution of the labour agreement.
The employer should be able to demonstrate, based on evidence, that the cost reimbursements correspond with reality. RSM can guide you with the determination of the proper amount of costs proper to the employer and guide you with tax ruling requests, building of a support file and the implementation of these cost reimbursements in the policy of your company.
10. SALARY SPLIT
In today’s global world, many employees are working in cross-border situations. The tax and social security consequences of employment in more than two countries can be significant. Personal income tax can be due in more than one country, meaning corporate tax consequences can arise. It should also be determined in what country social security is due. Various formalities should be fulfilled and a proper payroll implementation is an absolute requirement. Together with our offices in other countries, RSM can help you structure the salary split, ensure legal compliance and take care of a correct practical implementation.
11. NON-RECURRING RESULT-TIED BONUS PLAN
Non-recurring result-tied advantages are advantages linked to collective achievements by the company, a group of companies or a well-defined group of employees, based on objective criteria. These advantages depend on the realisation of clearly defined, transparent, definable/measurable and verifiable objectives, which are uncertain at the implementation of the bonus plan. These advantages are exempt from personal income tax and are only subject to a solidarity contribution of 13.07% by the employee and 33% by the employer. Our specialists can assist you with the practical implementation of this type of bonus plan.
12. R&D WITHHOLDING TAX EXEMPTION
One of Belgium’s objectives is to dedicate part of the GDP to research and development. Considering the important role of companies in this respect, several fiscal measures exist to stimulate R&D. One of these measures is the R&D withholding tax exemption. This states that a company is exempt from transferring up to 80% of the tax withheld from the employees’ salaries to the Belgian tax authorities. Certain requirements are imposed both on the companies and the employees. RSM can offer your company guidance in obtaining and implementing this benefit.
13. EQUITY INCENTIVES
Over the years, companies have been trying to retain and reward high-performing employees through various incentives. Belgium has advantageous tax schemes for equity-based rewards, such as stock options and restricted stock units. Several Belgian banks offer products which take advantage of these tax schemes. In the case of stock options, Belgium’s legislation provides a flat-rate taxation at the time of grant, which is directly opposite to other countries, which tax stock options at the time of exercise.
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