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

[nodric]

Ok, how about extending the Expat Status to temp. contractors?

I've gotta say I was pretty miffed when I discovered that foreign employees seconded by foreign companies are entitled to this Expat Status, whereas a self-employed foreign person isn't.

Great idea, but I refer to my earlier points here. The expat status came about to service the needs of Blue Chips who were encouraged to setup in Belgium. Alas, we're not in their league!

However, as mentioned many times, if you have a MyCo you can apply for that Expat status. Just remember Centre of Economic Interest.

[Sergeant Murphys Cosh]

Great idea, but I refer to my earlier points here. The expat status came about to service the needs of Blue Chips who were encouraged to setup in Belgium. Alas, we're not in their league!

How about we complain it's against our Human Rights to be discriminated against in this manner?
And get it back-dated too !

Get the PCG involved.

[nodric]

A Note for the Brits working in Belgium

I know I’ve spoken about this often in this thread, but the tax rules for Belgium 2010 have again made it clear.

Definition of a resident.

An individual is regarded as resident only if he spends a certain period of time in Belgium (the 183 day test, that’s 183 days not including travelling days) and has his main home or his centre of economic interest in Belgium.

An individual resident in Belgium is liable to personal income tax on his worldwide income and on certain capital gains.

Definition of a Non Resident

An individual is regarded as non resident if he spends less then 183 days a year in Belgium, and has his main home or his centre of economic interest outside of Belgium. e.g. He does not have a permanent home in Belgium.

A non-resident individual is liable to tax on his Belgian-sourced income only.

Therefore for those of you who work via your MyCo, and keep your home, wife, kids etc in the UK, YOU ARE A NON RESIDENT.

You only have to declare your salary earned in Belgium. i.e. The amount of income paid to you as an employee of your MyCo for worked carried out in Belgium.

All additional profits into your MyCo, or dividends from other countries (see my other thread) are exempt from the clutches of the BTA!!!

You could also argue, that if the income is derived from a UK agency, then non of the income is Belgian-sourced! If this was the case, you could also argue that you have no requirement to register with LIMOSA. These arguments need to be validated by an expert.

In simple terms, if you keep below the 183 days (full 24hr periods spent in Belgium) in anyone tax year (Jan - Dec), stay only in hotels or B&Bs, and go home most weekends, then you are not required to register as a resident at the Commune, and need only register with LIMOSA as a foreign work on assignment, and declare the salary you are being paid for the actual work carried out in Belgium.

This does not contradict the discussions in the rest of this thread, as many other scenarios are discussed.

The problems start to arise when you choose to rent an apartment, or even worse a house. The BTA considers renting a house as establishing your main home here, even if your family stay in the UK in your ‘real’ main home. Once your family move over, you have no escape.

Of course the old advice stands, talk to an accountant to make sure you stay within the rule, and he keeps you legal.

For more information seek out this handy Belgian Tax Guide here

[mk22]

A little spin on the tale

Hi All,

first of all - Nordic - I salute You for the information and effort put in the thread!

Now, I have a little question you guys/gals(?) might help me to answer.

My situation:
- moved with family to do contract work in BE,
- registered "one man band", did a bit of the "odd" stuff to be more efficient (so far so good, no backfires)
- I believe I became a "resident" (colored card, health insurance, social security & all that stuff)
- after a year of a good run in BE I got an offer to do a "quick gig" in NL
- a "quick gig" turned out to be so much more that now I work for that one client only and commute every day. (it's been almost a year now)
- in the mean time, except for registering with the taxman in NL (and applying for 30%, of course),
I changed nothing (still living here, family happy, kids & wifey speak dutch etc.)

Now, the time to do personal taxes in BE is almost up so I go to my accountant (not "the Ronald" btw ).
To my surprise, she states:
- for the last year when you still worked in BE, sure, you were a resident
the state would want your "worldwide income" and, of course, we won't double-tax you on the NL income
- oh, btw, the "city tax" will still be applied though (7.5% I believe)
- as you've moved all your work to NL, for 2010 I won't treat you like a resident next year ???

Now, as I understand it, it isn't necessarily bad to be "out of residency" as the system in here is so messed up
but I thought it's a bit more complex than that, is it?


p.s. Admin - I can has PM?

[nodric]

Hi All,

To my surprise, she states:
- for the last year when you still worked in BE, sure, you were a resident
the state would want your "worldwide income" and, of course, we won't double-tax you on the NL income
- oh, btw, the "city tax" will still be applied though (7.5% I believe)
- as you've moved all your work to NL, for 2010 I won't treat you like a resident next year ???

Now, as I understand it, it isn't necessarily bad to be "out of residency" as the system in here is so messed up
but I thought it's a bit more complex than that, is it?


p.s. Admin - I can has PM?

OK, first of all give a shout out to Brussels Slumdog, as he is almost working the same way as you describe, and has some experience with working in the NL on payroll (30%), and being resident in Belgium with his wife and family.

Residency has nothing to do with where you work. Therefore in Belgium you MUST file a local tax return as a resident, assuming you meet the criteria for being a resident (183 days+ a year, wife and kids here, living in a house, or your normal residence, CEI is here etc).

You MUST (or should really ;-) declare all your Worldwide income to the BTA. You claim allowance for taxes paid in the NL under the Double Taxation Treaty, and then only pay what’s due locally.

I would ask your accountant to clarify in writing what she actually means. She may have some loophole or clever manoeuvre (fiddle) I am not aware of that means you will treated as a non resident, even though you still are a resident. Interesting to share with us if she explains this more concretely.

I think it’s probably lost in translation. i.e. The words being used. I assume you’ll still be resident, hence the city taxes etc, but your income will be treated under the DTA as being fully paid up in the NLs.

Just ensure that your SS is valid, if you are expecting to use your SIS card for doctors bills etc, or to claim reimbursements back from the Mutualtie, and more importantly, to ensure your family have full access to local services.

If you become a non resident, and drop out of the system here, then you will also loose any benefits you exploit, the biggest being healthcare.

If your accountant cocks it up, it will be you with the bill in later years!

BSD, anything to add?

[Brussels Slumdog]

Belgian Residency

OK, first of all give a shout out to Brussels Slumdog, as he is almost working the same way as you describe, and has some experience with working in the NL on payroll (30%), and being resident in Belgium with his wife and family.

Residency has nothing to do with where you work. Therefore in Belgium you MUST file a local tax return as a resident, assuming you meet the criteria for being a resident (183 days+ a year, wife and kids here, living in a house, or your normal residence, CEI is here etc).

You MUST (or should really ;-) declare all your Worldwide income to the BTA. You claim allowance for taxes paid in the NL under the Double Taxation Treaty, and then only pay what’s due locally.

?

I am deemed a Belgian resident based on the fact that my wife and her son are Belgians and she owns the house here (183 days being irrelevant). Being a Belgian tax resident and not working in Belgium is actually better that being a UK resident and not working in the UK. In 2008 I worked in Switzerland and Germany only ie zero Belgian income. 2009/2010 Netherlands but I have now been on the bench for 3 weeks so I could end up ABB(Anywhere but Belgium) or Belgium.
Under Belgian double taxation rules all this income was exempt. Under UK double taxation rules I would have paid the difference between the UK rate(40) and the Swiss tax rate(20)

DUTCH ADVICE

If you work in the Netherlands you now need in addition to the SS that is deducted by your ManCO, private
health insurance which will cost you for the absolute minimum €100 month. I was fined €120 for registering too late
The SS deducted from salary goes to the unemployed and retired. The Private insurance insures you.
With this private insurance I otained an E106 so my SIS card in Belgium remains valid.

[mk22]

DUTCH ADVICE

If you work in the Netherlands you now need in addition to the SS that is deducted by your ManCO, private
health insurance which will cost you for the absolute minimum €100 month. I was fined €120 for registering too late
The SS deducted from salary goes to the unemployed and retired. The Private insurance insures you.
With this private insurance I otained an E106 so my SIS card in Belgium remains valid.

Great advice since this was one of the threads of the discussion with the accountant.
Thanks for clearing this up for me.

I've read that I'm supposed to stop paying Belgian health insurance (which I get back as kids support BTW)
but then, since I'm not married to a Belgian resident nor own a house in Belgium how do I "justify" my stay here?

Should I say I enjoy the climate and the tax system so much that I can't imagine living anywhere else in EU?

Initially, I registered my "one man band" and said I'll do business here but now the accountant say it's not so clear.



PS. in case you haven't noticed so far, I'm not UK citizen.
Hope it doesn't matter so much and I can buy you guys a beer some time.
I joined the good side of the force just 2 years ago and still looking for some answers.

[Brussels Slumdog]

Your situation is not Quite Clear

Great advice since this was one of the threads of the discussion with the accountant.
Thanks for clearing this up for me.

I've read that I'm supposed to stop paying Belgian health insurance (which I get back as kids support BTW)
but then, since I'm not married to a Belgian resident nor own a house in Belgium how do I "justify" my stay here?

Should I say I enjoy the climate and the tax system so much that I can't imagine living anywhere else in EU?

Initially, I registered my "one man band" and said I'll do business here but now the accountant say it's not so clear.



PS. in case you haven't noticed so far, I'm not UK citizen.
Hope it doesn't matter so much and I can buy you guys a beer some time.
I joined the good side of the force just 2 years ago and still looking for some answers.

I would need a bit more information to answer your question about stop paying your Belgian SS.
Based on my research and reading and being a EU citizen.
If your wife is working and paying SS then you may be covered by her contributions when you are not
working ie on the Bench or visa versa.
If you are independent and paying SS in Belgium then you can obtain an E101 if you work in another
EU country which will exempt you from paying SS in the other country (Not the Private part in NL or in CH)
No Management Company offers this solution from BE but only from IE,GB or Cyprus
If you live in Belgium and not paying SS in Belgium and working in another EU country then get an E106 from the other country to cover you in Belgium if you have a SIS card.

To Justify your stay you need to prove that you have work in Belgium. There are other treads on the WWW on this
topic. You are given 90 days plus another 90 days to find work. A read on some forum that someone did a weeks
work every 3 months to always get another 90 days.

[mk22]

I would need a bit more information to answer your question about stop paying your Belgian SS.

I am more than willing to provide details but was hoping to be able to "pay back"
for the answers in the form of nice cool drink of your choice
Do you guys meet once a fiscal year to brag/moan about work and everything else?

I swear I'm not dangerous and it's more than possible that I'm no competition (I specialize in a very narrow IT topic).
Just looking for some real life advice on how to manage living in this country.

If it was up to me alone, I wouldn't care too much and move around the whole EU
but it just so happens that my wife and kids like it here (strange?).

[nodric]

Do you guys meet once a fiscal year to brag/moan about work and everything else?

It’s a strange World of distrust this whole tax planning stuff

I’ve often toyed with the idea of booking a room, and inviting the masses to a briefing session, or whatever. I just don’t want to find that members of the audience include non contractors who have ulterior motives

It’d be a bit like organising a rave

However, there are meet ups in the UK, so maybe one day we can find a beer dispenser in Brussels we can all find our way to sometime.