BELGIUM Law and Practice Contributed by: Alain Van Geel and Emilie Van Goidsenhoven, Tiberghien
Cayman tax. In addition, an exit tax was introduced in case the founder of the legal construct migrates to another country. The scope of application of other taxable events (seat transfer of the legal construct, etc) has been enlarged. The founder can avoid pass-through treatment by showing that the legal construct (other than a trust) meets a substance test in the case of (among other requirements) the exercise of actual economic activi- ties that may not involve the management of the pri- vate assets of (one of) the founder(s). The substance requirements were further restricted as of 1 January 2024. The Cayman Tax does not only apply to offshore legal constructs, but also to companies and legal entities established within the EEA in the case such entities are not sufficiently taxed. Measures can be taken to anticipate the application of the Cayman Tax. For this reason, it is important to seek advice before making investments or setting up foreign structures. 11. Planning for Non-Traditional Families 11.1 Succession Rights and Estate Taxes for Non-Traditional Families Belgian law accords equal treatment to same-sex and opposite-sex spouses. Non-marital partners may also benefit from legal protection where they are rec- ognised as “legal cohabitants” (a form of registered civil partnership). However, their succession rights are more limited. In the absence of testamentary provi- sions, a legal cohabitant is entitled only to the usufruct over the family home and its contents. Legal cohabit- ants do not benefit from forced heirship protection. For gift and inheritance tax purposes, non-marital partners may benefit from the same preferential tax rates as spouses, provided that the cohabitation has lasted for a minimum statutory period. An exception applies in the Walloon region, where only legal cohab- itants are entitled to preferential rates, thereby exclud- ing de facto cohabitants. All children are equal before the law in Belgium, regardless of the circumstances of their conception or
the marital status of their parents. Thus, children born out of wedlock have the same rights as those born to married parents: their parentage can be established through recognition, legal presumption or court pro- ceedings, and they enjoy the same inheritance rights. Adopted children, once a full (plenary) adoption is granted, are legally assimilated to biological children: they inherit from their adoptive parents and no longer from their original family. Adoption creates a complete legal parent-child relationship, fully integrating them into the category of heirs for inheritance purposes. Regarding children born through surrogacy, Belgium does not have specific legislation, but the practice is not prohibited. It is tolerated as long as it is non- commercial and the intended parenthood is based on the informed consent of all parties involved. Legal parentage depends on postnatal legal establishment and not merely on intention or genetic connection. An intended parent may become a legal parent through recognition or adoption, provided the legal conditions are met. Children conceived after the death of a parent (post- humous conception) may, under strict conditions, be legally recognised. Belgian law does not explicitly prohibit posthumous medically assisted reproduction, but such a child can inherit only if legal parentage is established within the prescribed time limits. In all cases, inheritance rights depend on legal par- entage. Belgian law recognises the child as descend- ing from their legal parents, even in the absence of a genetic link (particularly in cases of adoption or sur- rogacy). Thus, it is the legally established parent-child relationship (and not merely the genetic or biological one) that determines whether the child is included among the heirs. Depending on the region, the following are assimilated to direct descendants for the application of the gift/ inheritance tax rates: • children adopted through simple adoption, provid- ed, amongst other things, that the adoptive child is the child of the partner of the adopter or has, before reaching the age of 21, received from the
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