BELGIUM Trends and Developments Contributed by: Aldo Engels, Emile Bauwens, Emma Parduyns and Vincenzo Vilardi, Loyens & Loeff
Introduction In recent years, transfer pricing has become a key focus area for the Belgian tax administration (BTA) and has gained increasing importance in Belgian tax practice. In 2020, the BTA published a circular letter (the “TP Circular” ) providing a comprehensive overview of transfer pricing prin - ciples in the Belgian context. The TP Circular is of practical relevance and offers valuable insights into the BTA’s views. In addition to a longstanding ruling practice, recent years have seen the emergence of case law that applies existing rules to concrete factual situations. This increase in case law is a direct result of the sig - nificant audit activity carried out by the BTA’s dedicated transfer pricing cell. In this contribu - tion, we highlight the latest developments in Belgian legislation, case law and administrative practice. Legislative Updates Public country-by-country reporting On 8 January 2024, Belgium transposed Direc - tive 2021/2101 on public Country-by-Country Reporting (Public CbCR) into national law by amending the Belgian Code of Companies and Associations. As a rule, the Belgian ultimate parent entity (UPE) must file the Public CbC Report in Belgium. A Belgian subsidiary exceeding a certain size threshold is only required to file if no other group entity – whether in the EU or elsewhere – files such a report. As a result, Belgian subsidiaries will generally only have a reporting obligation if they act as the EU holding company of a non-EU group or if no other EU group entity files a Public CbC Report. For non-EU headquartered groups, an exemption applies if the non-EU UPE volun - tarily files a compliant Public CbC Report. Bel - gian branches of non-EU companies may also
be subject to reporting if they exceed EUR9 mil - lion in annual turnover for two consecutive years. The content of the Public CbC Report largely mirrors the OECD CbC Report, except for the exclusion of stated capital. However, unlike the OECD version, data must be disclosed per juris - diction only for EU member states and countries on one of the following lists: (i) the EU list of non-cooperative jurisdictions, (ii) the Belgian tax haven list, or (iii) the OECD list of non-compliant jurisdictions. Data for all other countries may be aggregated. The report must be filed with the National Bank of Belgium (NBB) within 12 months of the end of the financial year. It must also be published on the group’s website, free of charge and acces - sible for at least five years, unless the NBB pub - lication exemption applies. The new rules apply to financial years starting on or after 22 June 2024. For calendar-year companies, this means the first report will cover the 2025 financial year and must be filed by 31 December 2026. Updated transfer pricing documentation requirements On 15 July 2024, Belgium introduced legislation updating the TP documentation requirements applicable to in-scope Belgian corporate tax - payers. New forms were published for the filing of the Master File, Local File and CbC Notifica - tion, bringing important changes that multina - tionals should consider going forward. The new Belgian Master File goes beyond the OECD model, which will require changes to the group Master File to comply in Belgium. A nota - ble new obligation is to perform a profit allocation analysis based on value creating functions which
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