Belgium

Company formation in brief

Foreign investors can be founders in many types of Belgian enterprises, but in practice, the following two organizational and legal forms of legal entities may be of interest to an investor:

• Naamloze Vennootschap - NV (SA) - joint stock company
• Besloten Vennootschap met Beperkte Aansprakelijkheid - BVBA (SPRL) - private limited company

Naamloze Vennootschap - NV (SA)

A Joint stock company has the following features:

• the company has at least two founders (individuals or legal entities), residents or non-residents of Belgium;
• Company shares may be issued to bearer.
• if the number of shareholders is only two, the company must have at least two directors;
• if the number of shareholders is unknown or there are more than two, the company must have at least three directors, who can be individuals or legal entities, residents of Belgium or foreigners.

Besloten Vennootschap met Beperkte Aansprakelijkheid - BVBA (SPRL)

A Private limited company is simpler in structure and is characterized as follows:

• the company can be established by one person - natural or legal, resident or non-resident of Belgium;
• shares of the company can be issued only in registered ones;
• a company can have one director, who can be a natural or legal person, a resident of Belgium or a foreigner.

Arbeidskaart / carte professionelle

In order to work as directors in a Belgian company, all non-residents must obtain an appropriate work permit (arbeidskaart / carte professionelle).

This work permit (professional card) and the Belgian residence permit are two different documents. However, both of them are needed in order to permanently live and work in Belgium. The application for these permits must be submitted at the same time. However, if the director of the company managed to obtain at least one of the permits by the time of registration of the company, then he is allowed to start work in a Belgian company.

Taxes

Belgium is not an offshore destination. The general corporate tax rate in Belgium exceeds 30%, but for both types of companies a reduced progressive corporate tax rate is possible, which applies if the company meets the following conditions:

• the company's profit does not exceed € 322,500 per year;
• individuals (one or more) do not hold more than 50% of the company's shares;
• the company pays at least one director (individual) an annual salary of at least € 36,000;
• the company does not pay dividends in excess of 13% of the paid-up share capital;
• the company does not belong to a group of companies with a single focal point for decision-making and control;
• the company does not have shareholders, the total share of which exceeds 50% of the paid-up share capital plus the amount of taxable reserves, which are formed from the undistributed (income) of the company to its shareholders after receiving the income.

Reserves mean that if a company receives income, there could be two ways to use it:

• to distribute all or part of the profit, after tax, in the form of dividends to shareholders or
• retain all or part of profit after tax in the form of reserves for the development of the company.

Since reserves can be derived from company profits, they are usually taxed in Belgium before being included in the reduced tax calculation and are called “taxed reserves”. However, a number of special Belgian regulations stipulate that part of the income can be exempt from taxation to be directed to a number of investments. Such reserves are recorded in the accounting records of the Belgian company as “non-taxed reserves”.

Before planning any activities covered by the above, we strongly recommend that you obtain additional advice from an auditor in Belgium.

All companies are registered with the Belgian Arbitration Court, which issues a certificate of registration only if sufficient evidence is provided that the foreign director (if there is one in the company) has a work permit and permanent residence in Belgium.

Belgium Double Taxation Agreements

Algeria, Argentina,Australia, Austria, Brazil, Bulgaria, Canada, China, Cyprus, Czech Republic, Denmark, Ecuador, Egypt, Estonia, Finland, France, Gabon, Germany, Ghana, Greece, Hong Kong, Hungary, Iceland, India, Indonesia, Ireland, Italy, Japan, Latvia, Lithuania, Luxembourg, Macedonia, Malta, Mexico, Moldova, Mongolia, Montenegro, Morocco, Netherlands, New Zealand, Nigeria, Norway, Poland, Portugal, Romania, Russia., Senegal, Serbia, Slovakia, Slovenia, South Africa, Spain; Croatia, Sweden, Switzerland;, Taiwan, Thailand, Tunisia;, UAE, United Kingdom, USA, Vietnam.

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