Contracting in Belgium - A Short Guide to Tax and Social Security

[wogewwabbit]

Thanks to both Brussels Slumdog & Boo for your replies. Brussels slumdog i know you said to head for a different country but I could have a few years work here & I am happy in belgium. Can you please give me your thoughts on the following:
The option that I would like to use is as follows: basically the way i feel i know best.
Stay working through my own UK based company declaring that I am an employee of my company that has been sent on a foreign mission to belgium to complete an initial 6 month contract. Now it's been extended for anther 3 months. Prove that my Centre of Economics Interest is the UK where I have worked for the past 10 years through my LTD company, I have a part time employee based in my UK company, will source about 20% of my company revenue for 2010 & 2011 in the UK, 80% in Belgium, etc.
I have signed the Limosa for the first 6 months & will have to do so again for the 3 months extension and so i assume that I will be in the belgium system!!! Is this correct & what does that mean for me personelly? I assume that means I have to pay belgium tax on only the salary that my company pays me & not the gross I earn for my company??
I have completed my E101 for the initial 6 months & will do so agin for the 3 month extension in the knowledge that this excludes me from the Belgium SS system? Is this correct or do i also need to register as an ex-pat executive on a temporary mission in Belgium? What does register as an ex-pat mean & what does it involve doing?
Actually if i was accepted as a registered ex-pat executive, then does that mean i can stay in my current set -up?
I know I need to talk to a good local accountant. Can you recommend a good accountant that deals with these types of contracts? Im based about 1.5 hrs from Brussels on train to the North west. If you have a good accountant in Brussels, Antwerp, Lier, Mol...i will travel to meet them.
Is it to late at this stage for me to register as an ex-pat executive considering I am just completing my initial 6 months this week.
If the above option works is there a time limit on it. Could I work that way say for 3 years

Hi guys i know i am asking a lot of questions & i really do apprecriate your views & thoughts on the above issues. It's hard to just find out what works without exposing yourself or your Ltd company!
thanks guys

Hi,

As far as I understand, if you stay over the 183 days, then ALL your worldwide income will become taxable in Belgium, even that you earned before the 183 days limit. Even that income, that your partner or whoever is sourcing (and was sourcing during the first 183 days) in the UK.

(I am not 100% sure about this paragraph, so advice needed):
I think you can get away with paying backwards taxes for the first 183 days, if you already paid all your taxes after that in the UK, by referring to the dual taxation treaty. But that is far from allowed, only overlooked. The right way to do it is to pay taxes from day 0 in Belgium, if you step over the 183 days. Maybe they will not fine you for paying taxes in the UK, maybe they will. (Someone correct me if I am wrong about this.)

I don't know what the limosa registration is affecting, this is a good question, I would be interested in the answers too. Can the taxman use the limosa registration to prove that I was working in Belgium from a specific day, and will they ever use it to check if I am working over the 183 days limit? As far as I know it from some experienced people, there is no connection between what the Belgian taxman does, and the limosa registration. If you forget to register the second time, noone will care. But this is just what I have concluded from what I've heard, I may need to be corrected.

If you register as an expat executive, that will only affect paying SS, but not taxes. You would still be liable for paying taxes in Belgium. I don't know what it involves registering, I think someone here said that you will need a Belgian accountant to do that.

I am in the same situation as you are, and I will leave Belgium when I reach the 183 days. Otherwise all my income would become liable for Belgian taxes, from day 0. That is why it may be a good idea for you to find another contract in the UK. If you stay, you will need to count with all the consequences.

[Boo]

As far as I understand, if you stay over the 183 days, then ALL your worldwide income will become taxable in Belgium, even that you earned before the 183 days limit. Even that income, that your partner or whoever is sourcing (and was sourcing during the first 183 days) in the UK.

I believe the correct statement of this is " then all your worldwide income will become taxable in Belgium"

AFAIK, there is no way they can tax income your company earns through other employees as if it had been earned by you.

Boo

[Oscar]

What if I want a Management Company?

Hi

What IF I WANT a Management Company?
Will most agencies let me do that? What should I look for to be sure?
(Is there a difference between UK agencies and Belgian service companies for example)

If they let me us a management company, am I subject to a standard policy of the management company, or does it depend on the agency?

I prefer to be compliant and not avoid tax, but I need maximum flexibility so that I am not locked away from my cash because I cant be self-employed for example.

[wogewwabbit]

Belgian accountant

Hi Guys,

Could someone here point me to a reliable Belgian accountant, who could give me advice on legally doing business in Belgium in the form of a UK ltd? It would be pretty urgent.

Cheers

[briancli]

Commuting from NL

Great information on this thread. Perhaps someone can help me a bit further as I don't think my circumstances have been covered.

I am currently an employee in NL. Shortly I will take up a contract in BE. This will be for an initial 6 months, realistically it should last a couple of years. I don't have a limited company anywhere.

My outline plan is to spend my weekends and two weekend nights in NL and two nights per week in hotels. So effectively I'll be based in NL but earning my income in BE. I will of course be accruing expenses in both countries.

Can anyone suggest what the best line for me to follow is? I'm on good terms with the NL tax authorities and would like to keep it that way.

Also I'd also welcome any suggestions as to a good accountant.

[vladone]

using an intermediate company

Once You go over go over the 183 days you will become liable for your WORLDWIDE income ...[removed]

I am about to sign a contract with a client in Belgium. I want the sign the contract using a normal company from another EU country (for example one from Eastern Europe where corporate tax is 10% and dividends 5% - fair rates I would say).
Can I use the following schema:
Client Belgium -> company Eastern Europe -> me, registered as freelancer(independent) in BE
The main part of the money paid by the Client will remain in the Eastern Europe company and the Eastern Europe company will pay me (as independent) only a very small part of them.

Questions:
Is this legal? What if the Eastern Europe company belongs only to my relatives(of course Eastern Europe fiscal residents)? I should not have any problems with the Belgian tax authorities, correct?

[Boo]

Can I use the following schema:
Client Belgium -> company Eastern Europe -> me, registered as freelancer(independent) in BE
The main part of the money paid by the Client will remain in the Eastern Europe company and the Eastern Europe company will pay me (as independent) only a very small part of them.

Questions:
Is this legal?

Yes. But if you are the beneficiary of the EE Co. then the BTA will take the seat of it to be in Belgium if you are the director / main earner.

What if the Eastern Europe company belongs only to my relatives(of course Eastern Europe fiscal residents)? I should not have any problems with the Belgian tax authorities, correct?

You should be safe if the ownership / management of the EE Co. is a true reflection of the actual situation. But if you do this in order to disguise the true position wrt ownership of the EE Co. then that is tax evasion / fraud in Belgium.

Boo

[Sergeant Murphys Cosh]

You should be safe if the ownership / management of the EE Co. is a true reflection of the actual situation. But if you do this in order to disguise the true position wrt ownership of the EE Co. then that is tax evasion / fraud in Belgium.

But what are you going to do about the DOUBLE taxation on dividends?

Fiscuriosa - Tax Topic - Why foreign dividends paid out to a Belgian shareholder are taxed twice ?

[Oscar]

I think it would be best if the do business other places (Not all invoices are to Belgium)

[Ginolard]

Hi all,

Not read the whole thread so excuse me if this has already been covered. I've been indepedent here since 1996 and, for most of that time, have worked via Classic Financial Solutions/Alpha Resourcing. For the most part, I've been quite happy with them and have gone along with their various re-adjustments to the ever more vigilant Belgian FISC.

However, I am not overly happy with the current situation of using a Life Assurance scheme in Luxembourg where they are the trustee and beneficiary.

I am considering setting myself up as an SPRL and working directly for my current employers. Is this really the most tax efficient way of working? I am pretty much going to be here until I retire!

My ideal situation is to have access to all my money when and where I want it and to reduce my tax burden as much as possible. Is SPRL the way to go then?