Changes to the investment deduction take effect retroactively from 1 January 2025, while the updated statute-of-limitations rules apply from 1 January 2023.
Belgium’s Chamber of Deputies passed legislation on 11 December 2025 to implement key elements of the government’s tax reform plan outlined in April 2025 targeting investment company share gains.
The main measures include:
- Introducing a separate 5% tax on capital gains from the sale of shares in certain investment companies that are generally exempt under the participation exemption.
- Expanding the participation exemption to cover profits from intra-group transfers, following a March 2025 CJEU ruling that Belgium’s previous limitation violated EU law.
- Removing the cap on the carried-forward investment deduction, standardising the deduction rate at 40% for all companies, and providing an additional 10% incentive for small companies investing in digital assets.
- Simplifying the statute of limitation periods, currently set at 3, 4, 6, and 10 years, will be streamlined to just two periods: three years and seven years.
- Increasing the withholding tax on new reserves from 5% to 6.5% starting in 2026, effectively raising the total tax rate from 13.64% to 15%.
The 5% capital gains tax and the expanded participation exemption will take effect from the 2026 assessment year.
The tax reform plan of April 2025 also includes the following:
VAT measures
- Raising the VAT on coal from 12% to 21%;
- Extending the 6% VAT for building demolition and reconstruction;
- Increasing the VAT on fossil fuel boilers from 6% to 21%.
Changes to the investment deduction and expat regime take effect retroactively from 1 January 2025, while the updated statute-of-limitations rules apply from 1 January 2023.
Earlier, on 24 April 2025, the Belgian Chamber of Representatives released a policy note outlining its tax reform plans for 2026.
