BELGIUM Law and Practice Contributed by: Alain Van Geel and Emilie Van Goidsenhoven, Tiberghien
In the area of gift and inheritance taxes, the rules are determined by the Regions. In general, legally cohabiting partners are treated in the same manner as spouses. Except in the Walloon Region, de facto cohabitants may also benefit from the favourable rates applicable to spouses and legally cohabiting partners, provided the statutory conditions are met. These con - ditions, however, differ between the Flemish Region and the Brussels-Capital Region, and typically require a minimum period of uninterrupted cohabitation. From a succession law perspective, legally cohabit - ing partners enjoy more limited statutory inheritance rights than spouses, while de facto cohabitants have no statutory inheritance rights. Consequently, wills, lifetime gifts and other estate planning techniques are frequently recommended for unmarried couples. As the notion suggests, both legal cohabitation and de facto cohabitation require the partners to live together and share the same principal residence. There are reduced rates of gift and inheritance tax for gifts or legacies made to associations or foundations, provided they meet certain conditions. In terms of income tax, gifts made to associations or foundations that meet certain criteria are also deduct - ible. 10.2 Common Charitable Structures Belgium has several structures that are used for char - itable planning, such as the private foundation, the non-profit association ( Association sans but lucratif , or ASBL) and the public interest foundation. Private Foundations 10. Charitable Planning 10.1 Charitable Giving The private foundation is a wealth planning tool that has been widely used for several years now. It was introduced by a law of 2002 and was reformed in 2019 with the adoption of the Code of Companies
and Associations. As such, the private foundation can be used in various contexts: • as part of family estate and succession planning; • for purely philanthropic, altruistic and disinterested purposes; or • as a tool for certifying shares. The private foundation can have an interesting tax regime, provided certain conditions are met (see 3.1 Types of Trusts, Foundations or Similar Entities ). The main disadvantages, however, are the administrative obligations and the publicity required. Non-Profit Associations The ASBL and the public interest foundation are most commonly used for charitable planning. The ASBL is an agreement between two or more members. The association must pursue disinterested purposes in the context of one or more specific activi - ties that it has as its object, and its founders, directors or members may never directly or indirectly obtain a capital profit from the ASBL. Profits may not be dis - tributed. Non-profit associations have a limited tax base and are subject to a favourable tax regime, as long as they do not carry out commercial activities. Public Interest Foundations A public interest foundation is a foundation whose dis - interested aim is to carry out a work of a philanthropic, philosophical, religious, scientific, artistic, educational or cultural nature. The articles of association of a pri - vate/public interest foundation must be set out in a notarial deed. The public benefit nature of a foundation is recognised by Royal Decree, so the exposure of such a founda - tion is important. In addition, as with private foundations, public interest foundations are subject to a special tax regime.
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