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Reclaiming wrongly withheld tax on dividends of Belgian (quoted) companies

With the “Tate and Lyle” ruling of 12 July 2012 the Belgian Court of Justice has brought an end to the discriminatory practice in Belgium relating to withholding tax on dividends.

A European company retaining a share of less than 10% of the capital of a Belgian company, but with an acquisition value of at least 1.2 million euros (2.5 million euros from 1 January 2010), is owing Belgian tax on the paid dividends. When on the other hand these dividends are received by a Belgian company, no tax is payable.

The Court has decided that this is incompatible with the free movement of capital.

European (holding) companies finding themselves in this situation can reclaim the wrongly withheld tax by either submitting a notice of objection within a period of six months, or a request for ex-officio exemption within a period of 5 years. 
The conditions under which the administration will accept the request to return wrongly withheld tax on were established in the Belgian circular no. Ci.RH.233/609.568 (AGFisc Nr. 26/2013) of 28.06.2013.

The law firm “Vanhaute advocaten” has already successfully conducted numerous procedures and will be pleased to assist you.

Fiscal regularisation also after 2 January 2014 still possible ?

We have received the question as to whether the regularisation of non-declared foreign income is still possible in Belgium.

Although the very last fiscal regularisation discussions have ended, one can still “spontaneously” regularise in Belgium at the local tax office, tax inspectorate or the public prosecutor.

This procedure has advantages and disadvantages. The country of residence tax is in this case taken into account, and no supplementary municipal tax is payable. The other side of the coin is that we can no longer call upon the former rates of the tax increase (10% to 15% on the regularised income), as provided for in the Belgian Programme Law of 2005, and that the tax authorities will apply the tax increase in conformity with article 444 of the Belgian Code on the income tax (10% to 200% of the supplementary tax). 

International Tax Specialists Group (ITSG)

As each year, in 2014 Vanhaute lawyers will also represent Belgium at the assemblies of the International Tax Specialist Group (see held on 8 and 9 May in Milan (European department) and on 30 and 31 October in Paris (worldwide meeting). We will return to this shortly in more detail.