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

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    #31
    Nodric,

    For someone coming to Belgium this year, is this new Ltd Company structure a manageable and viable solution? I have a lot of people on my tail about various contracts in Belgium (as I speak French and Dutch), but I do not want unmanageable headaches when I get there.

    Realistically how difficult will it be to start a Ltd in Belgium from zilch upon arrival? I dont imagine it to be plain sailing, and probably more of an overhead than a UK Ltd - but minus the IR35 baloney.

    Other options would be payrolling companies like CapitalConsulting, Triage and Itecs - these are 3 that I believe to be sufficiently above board. You did mention in passing one local payrolling option that you believe to be acceptable also.

    From what I can make out being self-employed is suicidal and splitting mancos are likely to cause severe headaches somewhere down the line.

    Comment


      #32
      Does Limosa still apply if you operate through your own Belgian Ltd?

      Comment


        #33
        At what turnover figure does VAT become obligatory in Belgium?

        In the 1st year of trading in Belgium, how frequently does the director(the contractor) have to file returms for PAYE, Corp tax and VAT (if mandatory)?

        How easy is it to create a Belgian Ltd? Are there off the shelf companies to purchase as in the UK or can an accountant do this for you? What are the costs involved?

        What are typical acountant's annual fees?

        Does the director require a second Belgian resident to act as secretary?

        All in all, in spite of the 1 euro capital, I anticipate that there is still quite a bit of spade and leg work to do on tehe contractor's part, especially for someone newly arriving with a probable hotel address i.e. not fully resident.

        Comment


          #34
          If you run a Belgian Ltd, do you have to have more than one client? - which is more or less the case in France and Germany. To some extent, this is part of the UK's IR35 twaddle i.e. you are working 5 years at Corporate PLC as a Ltd, hence Gordon and Hector get upset/excited about it.

          Comment


            #35
            Originally posted by MrGrunge View Post
            Nodric,

            Realistically how difficult will it be to start a Ltd in Belgium from zilch upon arrival? I don't imagine it to be plain sailing, and probably more of an overhead than a UK Ltd - but minus the IR35 baloney.
            You need the services of an accountant to setup the company, and a Notary. Normally the accountant does all the company formation work for you. Expect to pay around 1000 Euros to start a company in fees, plus another 700 Euros to the Notary. Of course these fees are deductible

            No shelf companies in Belgium! It’s not cheap, but it is tax efficient, and of course legal

            Expect to pay around 3K Euros a year in Accountancy fees to do your books, vat and tax returns etc. If you are fluent in the local languages, and reasonably well versed in Belgian accountancy, then this cost can be cut. However, for most of us, this will not be the case.

            Originally posted by MrGrunge View Post
            Other options would be payrolling companies like CapitalConsulting, Triage and Itecs - these are 3 that I believe to be sufficiently above board. You did mention in passing one local payrolling option that you believe to be acceptable also.

            From what I can make out being self-employed is suicidal and splitting mancos are likely to cause severe headaches somewhere down the line.
            Payroll companies offering to pay you all your earnings as salary would be legal, but rarely is this the case. Most offer various investments to offshore a portion of your funds. Paying all your contractor income as personal salary would incur huge tax and social security bills! On top of this, the employer would have to pay there contributions, which means you would have to pay them from your net income!

            If the payroll company is not prepared to send you a written explanation of exactly how the scheme works, chances are it would be subject to unwelcome scrutiny by the local tax man.

            Split income schemes are covered in detail in this post, sufficed to say, they are non compliant, and if you get caught, you will get a large life changing bill!

            Originally posted by MrGrunge View Post
            Does Limosa still apply if you operate through your own Belgian Ltd?
            I,ve covered this in detail, but in short, NO LIMOSA does not apply if you are fully registered in Belgium. It is there to register people who work via foreign companies etc.

            Originally posted by MrGrunge View Post
            At what turnover figure does VAT become obligatory in Belgium?
            VAT (TVA or BTW) is payable from day one on all companies and self employed registrations. There is no threshold like there is in the UK.

            However, if you follow the advice earlier in this guide, you can become a net receiver, never worrying about having to pay VAT.

            Originally posted by MrGrunge View Post
            In the 1st year of trading in Belgium, how frequently does the director(the contractor) have to file returns for PAYE, Corp tax and VAT (if mandatory)?
            VAT returns are quarterly. Tax returns annual. Tax year is Jan-Dec. You pay in arrears.

            Originally posted by MrGrunge View Post
            How easy is it to create a Belgian Ltd? Are there off the shelf companies to purchase as in the UK or can an accountant do this for you? What are the costs involved?

            What are typical accountant's annual fees?
            See above.

            Originally posted by MrGrunge View Post
            Does the director require a second Belgian resident to act as secretary?
            No.

            Originally posted by MrGrunge View Post
            All in all, in spite of the 1 euro capital, I anticipate that there is still quite a bit of spade and leg work to do on the contractor's part, especially for someone newly arriving with a probable hotel address i.e. not fully resident.
            To form a company, you will need a permanent address in Belgium. You cannot operate a company from a hotel, or B&B etc. Basically, you will need a rental agreement on an apartment or house.

            Originally posted by MrGrunge View Post
            If you run a Belgian Ltd, do you have to have more than one client? - which is more or less the case in France and Germany. To some extent, this is part of the UK's IR35 twaddle i.e. you are working 5 years at Corporate PLC as a Ltd, hence Gordon and Hector get upset/excited about it.
            So far, this has not proved to be a problem in Belgium. There is legislation that could test whether you are an employee of a company, or a real consultant. Many contractors work for the same, and single client, for 5 years or more without problems.

            I had provided much of this information throughout the earlier pages in this post. I do recommend a detailed read of this to answer many of your questions.

            I am not an expert, just someone who has experienced things first hand. If you need expert advice then seek out a qualified expert. My opinions are just that, my opinions. I could be wrong, and laws change, so trust nothing I say

            Comment


              #36
              Originally posted by nodric View Post
              As far as I know, it comes from the little man who used to do the self assessment adverts on British TV. His name was Hector. However, I'm sure the forum regulars will correct me if I'm wrong
              I always thought it was from Hector the House, because...




              ...the house always wins !

              Boom Boom.

              --
              Boo

              Comment


                #37
                Hey All

                very intersting post indeed.

                My situation is that I do not have a degree and cannot open a LTD Co. Can some suggest to me what my options really are?

                Cannot I work on contracts?

                Thanks for your help and time

                Comment


                  #38
                  Originally posted by Boo View Post
                  I always thought it was from Hector the House, because...




                  ...the house always wins !

                  Boom Boom.

                  --
                  Boo
                  Oh yes, good old Hectors House! Showing my age now

                  For those that have no idea what we are talking about, or think we've lost the plot, check this out link.


                  I am not an expert, just someone who has experienced things first hand. If you need expert advice then seek out a qualified expert. My opinions are just that, my opinions. I could be wrong, and laws change, so trust nothing I say

                  Comment


                    #39
                    Originally posted by JohannM View Post
                    Hey All

                    very interesting post indeed.

                    My situation is that I do not have a degree and cannot open a LTD Co. Can some suggest to me what my options really are?

                    Cannot I work on contracts?

                    Thanks for your help and time
                    Johann,

                    You can:-

                    1. Work for a Belgian company as an employee. Downside is high taxes & costs.
                    2. Pass a competency exam in one of the national languages. (Take a course and examination in basic accountancy etc). Takes a month or so to complete. Small costs involved, but you need to speak the languages, and of course pass!
                    3. Use a non compliant ManCo and risk getting caught.
                    4. Work for a fully compliant ManCo. No such thing currently. If they cannot send you a full written explanation of how their scheme works, and provide evidence that the Belgians accept their way of working, then walk away.
                    5. Work via your own UK LTD Co, or similar non Belgian company. This is covered in detail in this thread.
                    6. Work via someone else's UK LTD Co. Very similar to option 5 except that the directors of that UK LTD Co would have to arrange your status in Belgium, which would of course involve costs to you each month.

                    For options 4,5 and 6, you need the services of a skilled accountant in Belgium, and if going the option 5 or 6 route, a similarly skilled accountant in the UK.

                    The only other way you can get round the non degree issue, is by showing you have acted as a company director for another company for a continuous period more than 3 years. Companies House evidence, or similar, will be required.

                    If you want some ideas for option 1, and details of an accountant, send me a PM.

                    .
                    I am not an expert, just someone who has experienced things first hand. If you need expert advice then seek out a qualified expert. My opinions are just that, my opinions. I could be wrong, and laws change, so trust nothing I say

                    Comment


                      #40
                      hey Nordic

                      sent you a PM

                      Comment

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