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Belgium: Domestic Corporate Taxation

Withholding Taxes On Incoming Dividends

As a member of the EU Belgium is governed by the provisions of the EU's Parent-Subsidiary directive, whose effect is that where a Belgian holding company controls at least 10% (15% prior to January 1, 2009) of the shares of an EU subsidiary for a minimum period of 12 months, or engages to do so, any dividends remitted by the EU subsidiary to the Belgian holding company are free of withholding taxes.

Where the provisions of this directive do not apply (or where anti-avoidance provisions are in place) Belgian holding companies can rely on an extensive network of double taxation treaties, the effect of which is to obtain a reduction in withholding tax rates on dividends remitted to Belgium from the subsidiary jurisdiction.

Belgium has over 100 double taxation treaties in place (at the time of writing). (Denmark has 69 and the UK over 100). The greater a country's network of double taxation treaties the greater its leverage to reduce withholding taxes on incoming dividends. An elaborate network of double taxation treaties is thus a key factor in the ability of a territory to develop as an attractive holding company jurisdiction.

 

 

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