BELGIUM Trends and Developments Contributed by: An Weyn and Aurore Sultus, Arteo
Tax on Securities Accounts (TSA) An annual tax of 0.15% applies to securities accounts that exceed EUR1 million in average value. Accounts within scope of the TSA The TSA is a subscription tax levied on securities accounts. A securities account is defined as an account on which financial instruments can be cred - ited and debited. Securities accounts are within the scope of the TSA if they are held by individuals or legal entities. For the purposes of the TSA, founders of legal construc - tions that are targeted by the Cayman tax are treat - ed as account holders with respect to the securities accounts held by these legal constructions. Belgian resident account holders are subject to the tax with respect to both their Belgian and foreign securi - ties accounts. Non-resident account holders are tar - geted with respect to their securities accounts held with Belgian financial institutions. It follows from the aforementioned rules that securi - ties accounts held by foreign trusts are in scope of the TSA if the settlor of the trust is a Belgian tax resi - dent (individual), regardless of whether the accounts are held with Belgian or foreign financial institutions. Securities accounts held by legal entities that are treated as legal constructions (eg, Luxembourg SPF, US LLC, BVI company) are also in scope if the (indi - rect) shareholder of the entity is a Belgian resident (individual), regardless of whether the accounts are held with Belgian or foreign financial institutions. Taxable basis and rate of the TSA The annual tax rate amounts to 0.15% and the taxable base equals the average value of all financial instru - ments held in the securities account. This includes securities such as shares, depositary receipts, bonds, investment fund units (eg, trackers/ETFs) and deriva - tives. Importantly, the cash balance held on the actu - al securities account is also included in the taxable value. Financial instruments that are not held through a securities account, such as registered shares, are not
subject to the tax. Cash is not within the scope of the TSA if it is held through current or savings accounts. The average value held in the account is calculated by taking into account a reference period of 12 months, running from 1 October to 30 September. Threshold of EUR1 million The tax is only due if the average value of the securi - ties account exceeds EUR1 million. This threshold is applied with respect to the securities account itself and does not take into account the share of each account holder in the case of joint ownership. Filing and payment obligations With respect to securities accounts held with a Bel - gian intermediary (by a Belgian resident or non-resi - dent account holder), the tax return must be filed and the tax must be withheld and paid by the interme - diary. If the securities account is held with a foreign intermediary, the account holder must ensure the filing and payment of the tax themselves, unless they can demonstrate that these obligations have already been fulfilled by another intermediary. Influence of tax treaties The application of the TSA with regard to securities accounts held with Belgian financial institutions by non-resident account holders raises the question of whether or not an applicable double tax treaty pre - vents Belgium from imposing such a tax. If the relevant double tax treaty covers taxes on capital (wealth tax) and allocates taxing power to the resident state, Belgium should not be allowed to levy the TSA on securities accounts held by non-resident account holders. For example, for a Dutch tax resident, the double tax treaty between Belgium and the Nether - lands stipulates that assets such as securities on a securities account may only be taxed in the country of residence (ie, the Netherlands) and thus not in Bel - gium. Tax aspects relating to trusts Income tax treatment of distributions made by a trust From a Belgian income tax perspective, any distribu - tion made by foreign trusts to beneficiaries that are
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