The flagship is of course the reduction in rates for all companies, with an additional reduction for SMEs. The reform of the corporate tax rates takes place in two phases: from the tax year 2019 linked and from the tax year 2021.
Of course, the reform must be completely budget neutral. The compensatory measures are divided into two phases. All Phase 1 measures shall, unless otherwise stated, enter into force as from 1 January 2018 and shall apply from the tax year 2019 for an accountancy year beginning at the earliest on 1 January 2018. This includes combating dyeing society, restricting the notional interest deduction and providing a minimum taxable base. In addition, this first stage also affects advance payments , the tax treatment of prepaid costs and capital reductions are subject to a modified regime.
Unless otherwise stated, the second phase of these compensatory measures will enter into force on 1 January 2020 and will apply from tax year 2021 onwards, linked to a taxable period beginning at the earliest on 1 January 2020. These include changes in depreciation regimes, car costs in corporate income tax and the new implementation of ATAD-interest deduction.
VGD Belgium’s tax experts have explained all these changes and reforms in a comprehensible memo, going into detail for each of these points and explaining the impact these changes can have on companies.
You can download the full memo below