It has been announced that as from 1 January 2018, Belgian individual tax residents will be subject to an annual tax of 0,15% on their Belgian and foreign securities accounts.
Based on current information available, the tax would only target Belgian individual tax residents (persons subject to personal income tax).The tax would apply to both Belgian and foreign securities accounts. It is expected that also registered (nominative) securities will qualify as a securities account and would thus be taxable.
The tax would only be due if, over the reference period, the total average value of the Belgian and foreign account(s) of the Belgian individual tax resident would be at least € 500.000.
To determine the taxable base and whether the threshold of € 500.000 is reached, only quoted shares and bonds (as well as certificates thereof), shares of investment companies and units in investment funds (excluding life insurance contracts and pension savings accounts) and quoted structured products linked to the aforementioned assets should be taken into account.
To limit the possible impact of important fluctuations in the value of the taxable securities that are held, e.g. by year-end, the taxable base would be the total average value of the securities over the reference period (calculated based on monthly averages).
Principally (similar to the Belgian stock exchange tax) it will be Belgian banks and stockbroking forms who will have to pay and declare the tax due, if the average value of taxable securities on its securities account is at least € 500.000.
Optionally, the Belgian tax resident can ask the Belgian bank to pay the tax also on the accounts not reaching € 500.000. Hence, if a Belgian tax resident has several securities accounts with different Belgian banks, and if the value of the each individual security account is lower than € 500.000 but in total at least € 500.000, the Belgian tax resident can be freed from paying and declaring the tax himself.
For foreign bank accounts, however, it will always be the Belgian individual tax resident who needs to pay and declare the tax (by means of a special declaration).
It is expected that additional control measure will be put in place.
For example, Belgian banks will have to yearly inform their Belgian individual clients on the average value of their securities accounts and will likely be required to provide additional information to the National Bank of Belgium (number of accounts held by individuals with the bank and confirmation whether the Belgian bank has withheld the tax due for these accounts).
The first period for which this information will need to be processed will likely run from 1 January until 30 September 2018.
The law has not been published yet and therefore the practical modalities may still be subject to change. But it is clear that Belgian banks and Belgian investors (individuals) will be confronted with additional formalities.
We will keep you updated on further changes. Meanwhile, do not hesitate to reach out to your KPMG contact in case you want to discuss the practical impact.
© 2018 KPMG Tax and Legal Advisers, a Belgian Civil Cooperative Company with Limited Liability (burg. CVBA/SCRL civile) and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
KPMG International Cooperative (“KPMG International”) is a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.