International Tax 2026

BELGIUM Law and Practice Contributed by: Robin Minjauw and Anouk Van der Mast, Tiberghien

• third, the entity must have its principal place of management or its effective seat in Belgium (“real seat doctrine”). A company whose statutory seat is located in Belgium is presumed to have its effective management in Bel - gium, unless it can demonstrate that its management is located abroad and that it is considered tax resident in another jurisdiction under its domestic law or the applicable tax treaty. Under the “real seat” doctrine, companies could be subject to Belgian corporate taxation even if they are governed by the corporate law of another country. 2.6 Definition of Permanent Establishment The concept of permanent establishment (PE) is defined in domestic law through the notion of a “Bel - gian establishment”. This definition is clearly inspired by Article 5 of the OECD Model Tax Convention, as it uses the same core concept of a “fixed place of busi - ness” through which the activities of a foreign enter - prise are wholly or partly carried on, and it includes a similar non-exhaustive list of examples. However, the Belgian domestic definition is broader than the OECD Model definition in several respects. Most notably, Belgium applies a much lower threshold for construction sites, as a construction project may constitute a Belgian establishment if it lasts more than 30 days, whereas the OECD Model uses a 12-month threshold. In addition, Belgium provides for a wider dependent agent rule: a Belgian establishment may exist even if the intermediary does not have authority to conclude contracts, which goes beyond the stand - ard OECD approach. Belgium also includes an explicit service PE rule, whereby the provision of services in Belgium through individuals present for more than 30 days within a 12-month period (without a fixed place) may create a Belgian establishment. The concept of a service PE is not part of the standard OECD Model. In its tax treaties, Belgium generally follows the OECD Model definition of a PE. The Belgian Model Tax Con - vention largely mirrors the structure and wording of Article 5 OECD Model. However, the Belgian Model

Convention (2010) reflects the pre-BEPS version of Article 5 and does not fully incorporate certain BEPS Action 7 developments, such as the explicit anti- fragmentation rule introduced in the updated OECD Model. 3. Taxation of Cross-Border Income 3.1 Income From Immovable Property Belgian Tax Residents Belgian resident individuals are taxed on their world - wide income, including income derived from Belgian and foreign immovable property. Belgian immovable property • For private rental (unfurnished, private use by ten - ant), the taxable income is based on the indexed cadastral income (KI), increased by 40%, and taxed at progressive personal income tax rates. • For professional rental (business use by tenant), the taxable income is based on the actual rental income received, reduced by either actual expens - es or a lump-sum deduction (capped at 40%), and taxed at progressive rates. • For furnished rental, the rental income is split between immovable and movable income. In the absence of contractual allocation, 40% is deemed movable income, taxed separately at 30% after a 50% lump-sum cost deduction. Foreign immovable property Since assessment year 2022, foreign real estate owned by Belgian residents is assigned a surrogate cadastral income, ensuring comparable treatment to Belgian property. • Where a double tax treaty applies, foreign immov - able income is generally exempt in Belgium with progression. • In the absence of a treaty, such income is typi - cally taxable in Belgium at half the normal personal income tax rate (Article 155, ITC 92). Non-Residents Non-resident individuals are taxed only on immovable property income sourced in Belgium.

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