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

[sleek]

If you stay in a Bed & Breakfast or in a Hotel then you won't need to register (in fact you cannot register from these types of accommodation). I did that and everything was fine.

Hmm I know this was the case when I stay here less that 3 months, but shouldn't I register if I will stay more? I'm st aying on apartment hotel so if I cannot register because of that it would be good of course...

[sleek]

If you are covered for social security in another country that should be sufficient, you wouldn´t be expected to pay Belgian social security. If you are taxed in income in Belgium for an income of 35,000 you would pay 33% tax (I checked). If you did pay tax on your Belgian income there would either be no tax to pay on it in Finland or a top-up amount. A lot of the horror figures banded around here are based on being tax resident in Belgium. Since you won´t be in Belgium for longer than 183 days this won´t be the case. Who knows maybe you can wangle paying no tax.

Once you´ve registered with LIMOSA I think you can assume they´ll expect a tax return.

Take advice from an accountant in Belgium and I think you have little to fear.

By registering and declaring you can avoid the unfortunate incident of the contractor in Germany facing a criminal prosecution because they cross checked an invoice which wasn´t declared.

Ah, I understand now, it's the social security which is the problem and I have E101. However taxes in Finland are STILL more lighter than in Belgium so I'll try to optimize my taxes to Finland no matter what. That's because I can deduce up to 2000 EUR per month from Finnish taxes just because I am roaming out of my home country...

Then again, I'll realistically expect I will be offered for further extension of my contract when my current contract is about to be expire. That contract I just have to refuse as it would push my tax% to 50% in Belgium - or they will need to allow me to work from Luxembourg (or any other country than Belgium)...

I probably could get away NOT paying taxes to any country, but then I would commit tax fraud. Law in Finland says that if Finnish citizen has any income that any other country do not tax, then Finland will. I could leave Belgium and not to fill tax return AND not declare my money to Finland, but that would be fraud

Thanks again! On the side note, I already contacted accountant via E-Mail so probably they will get back to me on next week.

[Brussels Slumdog]

Become a landlord

Jesus Christ. How do Belgians survive? I will leave, no doubts. Thanks!

Firstly we don't work for €400 a day and secondly we receive rent which is not taxed

[sleek]

Firstly we don't work for €400 a day and secondly we receive rent which is not taxed

Just out of curiosity; what would be typical Belgian day salary in IT-sector?

It seems I have to be more careful when accepting international jobs. In Finland EUR 400 per day is considered top end salary but it boils down to lighter taxation then.

[Brussels Slumdog]

Tax and Social Security

Just out of curiosity; what would be typical Belgian day salary in IT-sector?

It seems I have to be more careful when accepting international jobs. In Finland EUR 400 per day is considered top end salary but it boils down to lighter taxation then.

Firstly you have to consider tax and social security as some East European states have low taxation but high social rates so you need to obtain a quote from a management company before accepting an offer

My lowest SAP quote for Brussels would be €500 just to be home every night. It seems that the job offers that require both French and Dutch the rate is between € 650 and €700

Most Belgian contractors are self employed which means that they only pay the 33% rate on a maximum amount whereas when you work for a company ie a management company then you pay 33% without the limited amount plus the 13%. The problem for most foreign contractors on short term contracts less than a year , becoming self employed is not really an option. I am not self employed even though I have lived here since 1999 as I nearly always end up working outside europe.

[sleek]

My lowest SAP quote for Brussels would be €500 just to be home every night. It seems that the job offers that require both French and Dutch the rate is between € 650 and €700

Ok, so my quote is not that bad after all; it's actually EUR 500 per hour for product similar to SAP, but there's Christmas and Eastern holidays and some internal holidays etc. which cause it to go down to about EUR 400 for first months at least. And I do not speak French nor Dutch a word so I cannot be THAT picky :-)

This contracting world is all new to me so it seems I have to make mistakes. Luckily, I got away with accepting this job thanks to you. I just leave soon enough and I still made decent salary, or on typical Finnish scale, stellar salary (my net income will triple what I got from Finland as regular worker).

Thanks again!

[Brussels Slumdog]

Improve your salary

Ok, so my quote is not that bad after all; it's actually EUR 500 per hour for product similar to SAP, but there's Christmas and Eastern holidays and some internal holidays etc. which cause it to go down to about EUR 400 for first months at least. And I do not speak French nor Dutch a word so I cannot be THAT picky :-)

This contracting world is all new to me so it seems I have to make mistakes. Luckily, I got away with accepting this job thanks to you. I just leave soon enough and I still made decent salary, or on typical Finnish scale, stellar salary (my net income will triple what I got from Finland as regular worker).

Thanks again!

The daily rate is not everything. What you should be aiming for as a contractor is to continually be adding value to your CV. You just need to ask yourself one question at the end of the contract. Did I enjoy living and working in another country and has my CV improved ?
Remember sometimes you have to drop your rate to learn new skills or add a good company to your CV

[sleek]

The daily rate is not everything. What you should be aiming for as a contractor is to continually be adding value to your CV. You just need to ask yourself one question at the end of the contract. Did I enjoy living and working in another country and has my CV improved ?
Remember sometimes you have to drop your rate to learn new skills or add a good company to your CV

I agree fully. I wouldn't have resigned from my previous permanent full-time job for salary only, but I considered this opportunity to be too good to miss because I've always wanted to work and live abroad and yes, it WILL look good in the CV already Step to resign was probably biggest step I've ever made and caused extreme anxiety to me - and yet I have been already enjoying working and living here in Brussels so much that I do not regret accepting this job a second. Weird huh...

But when I open Excel to calculate what I gain, I just cannot but try to optimize my net income. Probably comes with extremely logical mindset which is required to do this job at first place - why would I NOT to optimize if I can and I have no special ties to current country? That, unfortunately, required me to leave Brussels. But then again I can see new countries and people so that too, is pretty exciting!

Thanks again for advices!

[sleek]

Ok, I contacted today three (3) separate Finnish tax officials and lawyer and got confirmation I am clear:

* If I work under 183 days per calendar year in Belgium for Finnish company who does not have office in Belgium, I pay taxes to Finland. If Belgium tries to claim other, Finland will sort it out for me. In theory I could work almost 12 months without paying taxes to Belgium - I would just need to start on July X and leave on June X+1. Now I will work 8 months (two for this year, six for next year) and that is still ok.

They didn't know if I need to fill Belgian tax return though, that is Belgium's internal matter and is out of interest of Finnish officials. I think I will fill tax return if I get one btu if not, I'll just forget it. May get one because of LIMOSA...

Then I contacted Brussels municipality and asked about registration.

* They said, it is impossible for me to register if I live in hotel. I would need fixed address to be able to register. They didn't respond to my question about what I should do because everywhere it says you HAVE to register if you stay more than 3 months, but I trust that if I get in trouble, this E-mail I got from Brussels will prove that at least I tried. So I pretty much do nothing for this issue also.

What I didn't ask was social security payments, but since I have A1 (E101) issued for my stay, I trust I am on clear waters. Got bit scared about social security trap on the first message of this thread, but A1/E101 is enough, isn't it? So this is also clear.

I'm now pretty sure everything is now covered and I legally will avoid Belgian taxes and social security.

Ps. Remember, this only work if you are domiciled in FINLAND, if your country you live in is anything else, rules may be totally different.

[BlasterBates]

If I work under 183 days per calendar year in Belgium for Finnish company who does not have office in Belgium,

Effectively you will have an office in Belgium, the office of the client will be your office. This is what the Belgian's may say,

The Finnish tax officials have no jurisdiction in Belgium. The Belgian tax officials will make their own decision. If they find an invoice with your name on it and you haven't declared anything they will calculate the tax for you. That's how it works.

Living in a hotel isn't an excuse for not registering otherwise everyone in Belgium would simply live in a hotel and pay no tax. Think about this....it doesn't give you immunity. I worked in Luxembourg, stayed in a hotel and had no problem registering with the Lux authorities with my German address. You can also probably register your company via a representative probably such as an accountant.

If you are determined to go ahead without informiing the Belgian tax authorities, good luck, just go in there with your eyes open, and cover your tracks.