Belgium: New withholding tax rates

09.01.2013

Further to our Taxflash L12020, dated 26 November 2012, and effective

1 January 2013

new withholding tax rates apply on interest from Belgian debt securities and on dividends from VVPRs and specific types of investment fund.

Debt securities

With some exceptions (mainly linked to a few specific National Bank of Belgium (NBB) eligible ISINs for which the current rates of 15% and 12.5% remain applicable, as appropriate), the tax rate applied on interest has been increased from 21% to 25%.

The account of Clearstream Banking1 at the NBB is an X account, to which tax exemption is applied by default based on the holding restriction in place and upon submission of the One-Time Certificate for Belgian Debt Securities integrated in the NBB X/N System. Thus, the rate increases do not impact these securities.

As a consequence, Belgian debt securities held with Clearstream Banking will be taxed at the following standard rates:

  • 0% on NBB-eligible bonds; and
  • 25% on bonds eligible in Euroclear Settlement for Euronext zone Securities (ESES), with the possibility to apply for a reduced tax rate through the current procedures2.

Equities

The tax rate applied on dividends remains 25%.

Verlaagde Voorheffing / Précompte Réduit (VVPR) strips

The advantageous tax rate on VVPR strips no longer applies; the rate on dividends paid as of 1 January 2013 is increased from 21% to 25%.

Lower tax rates for beneficial owners eligible for treaty rates or tax exemption according to Belgian legislation may be obtained through the current procedures2.

Investment companies

The tax rates applied on income are as follows:

  • The standard rate applicable to SICAVs with European passport, SICAFs, SICs and PRICAFs has been harmonised at 25%.
  • The rate applicable to SICAFI has been increased from 0% to 15%.
  • The rate applicable to liquidating dividend (boni de liquidation) remains unchanged at 10%.

Further information

For further information, customers may contact the Clearstream Banking Tax Help Desk on:

LuxembourgFrankfurt
Email:tax@clearstream.comtax@clearstream.com
Telephone:+352-243-32835+49-(0) 69-2 11-1 3821
Fax:+352-243-632835+49-(0) 69-2 11-61 3821

or Clearstream Banking Customer Service or their Relationship Officer.

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1. Clearstream Banking refers collectively to Clearstream Banking AG, registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in the Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500 (CBF) and Clearstream Banking, société anonyme, registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Register of Commerce and Companies under number B-9248 (CBL).
2. As described in our Market Taxation Guide – Belgium.

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