End-of-year tips 2025: corporate income tax

Starting in 2026, the rules around liquidation reserves change dramatically. For a detailed discussion, please see our earlier article in this regard (only available in Dutch): Dividenden: liquidatiereserve en VVPRbis groeien naar elkaar toe.

Reserves established until 31/12/2025

For liquidation reserves established until the end of 2025, the current tax regime remains unchanged. This means that when a liquidation reserve is created, a separate tax of 10% is payable first, and then – after a five-year waiting period – it can be distributed at a 5% withholding tax rate.

For liquidation reserves distributed or made payable as of July 29, 2025, the legislature provided an additional choice. In addition to the “classic” system, where a 5% withholding tax rate applies after a five-year waiting period, companies can also opt for a shortened three-year waiting period, coupled with a 6.5% withholding tax rate. This second option offers companies and their shareholders more flexibility when a faster distribution is desirable, although it comes with a slightly higher tax burden.

If the liquidation reserve is distributed within three years of its creation, a 20% withholding tax rate applies. No withholding tax is levied when a distribution is made following the liquidation of the company.

Reserves established as of 01/01/2026

Liquidation reserves as of Jan. 1, 2026 are subject to a standard 3-year waiting period (instead of 5 years) and rate of 6.5% withholding tax. The anticipatory levy of 10% upon creation is retained, bringing the total tax burden to 15%.

Are these “new” liquidation reserves distributed before the 3-year waiting period? Then this is considered a distribution of normal reserves and the withholding tax rate is 30%.

A 0% rate is retained for the distribution of liquidation reserves upon liquidation of the company.

Overview of WHT-rates as of 2026

If your financial planning allows it, consider not distributing existing liquidation reserves before the five year waiting period. That way, you will continue to enjoy the lower rate of 5%. In some specific cases (for example, when the shareholder needs additional liquidity on short notice), a distribution after three years at 6.5% may be an alternative to consider.

The recently announced November 24, 2025 budget agreement of the federal government states that the reduced rates relating to liquidation reserves and VVPRbis dividends will increase from 15% to 18%. Normally, a transitional measure will be introduced, which would prevent a quick distribution before the end of 2025. This measure has not yet been turned into an effective tax law, so the practical implementation is not yet known. Keep an eye on our website for updates on this topic.

The new capital gains tax is among the most discussed tax topics of the past year. Below is a brief overview of this new tax measure. For a more in-depth discussion, please refer to our following article: Capital gains tax on financial assets from 2026: impact on investors and entrepreneurs.

Scope

The capital gains tax rules apply only within personal tax and legal entities tax. Companies are not affected by this measure.

Taxpayers are individuals, NPOs or foundations that own or bare ownership of financial assets. The term financial assets is interpreted broadly and includes:

• Financial instruments such as stocks, bonds and derivatives
• Certain life insurance products
• Crypto assets in the broad sense
• Cash, including investment gold.

Furthermore, only capital gains arising from the normal management of private assets are subject to this tax. Capital gains arising from professional activities or abnormal management are taxed separately.

Finally, only capital gains realized from January 1, 2026 on for-profit transfers will be taxed. Historical capital gains accrued up to and including Dec. 31, 2025 remain exempt if they meet the necessary conditions, unless they are so-called “internal capital gains” (see below).

3 regimes

Within the new capital gains tax, you must consider three regimes distinct.

1. Internal capital gains

First, there are internal capital gains, which arise when shares are transferred to a company over which the transferor, possibly together with close relatives (up to the second degree), exercises control. Such transactions are taxed at a flat 33% rate without any exemption or exception, including for historical capital gains.

2. Capital gains with significant interest

Second, a regime for substantial interests applies. A shareholding is considered a substantial interest when the taxpayer owns at least 20% of the shares of a company. These capital gains are taxed progressively at rates ranging from 0% to 10%, with an exemption for the first bracket of 1 million euros per five-year period.

The 20% threshold is strictly assessed on an individual basis at the time of transfer. Shareholdings that have fallen below 20% due to dilution are automatically excluded from this regime.

When transferring shares in a Belgian company to a non-EEA legal entity with a capital gain above €1 million, a separate rate of 16.5% applies.

3. Standard regime

Finally, anything not covered by the above categories falls under the standard regime. This standard regime applies a flat rate of 10% and an annual (indexed) exemption of 10,000 euros, which can rise to a maximum of 15,000 euros if not fully utilized.

Capital gains calculation

The taxable capital gain is determined as the difference between the selling price and the acquisition value of the financial fixed assets in question. The sale price may consist of cash, securities or some other form of consideration. The acquisition value is usually the original purchase price. Costs and taxes such as stock exchange taxes or valuation costs are not included in the calculation. Any capital losses can only be deducted within the same category and taxable period.

As mentioned earlier, the capital gains tax only targets value growth as of Jan. 1, 2026. For financial fixed assets that were already owned, the starting point is Dec. 31, 2025. The value at Dec. 31, 2025 can be determined as follows:

• For listed shares: the market price as of December 31, 2025
• For unlisted financial assets, the higher of the following values:
  • The price paid by an independent third party in 2025 or the value used at incorporation or capital increase in 2025
  • The value determined based on a formula included in a contract of offer still applicable on January 1, 2026
  • Equity plus 4 times EBITDA from the last fiscal year ended before Jan. 1, 2026 (fixed formula)
  • A valuation on Dec. 31, 2025 by a company auditor (who is not the auditor) or an independent certified public accountant no later than Dec. 31, 2027.

End of Year

To minimize taxable capital gains, we recommend that no dividends be paid as of December 31, 2025. Retained earnings can increase the value of the corporation and decrease the capital loss. Please note that internal capital gains are not subject to the historic capital gains exemption. Thus, increases in value due to prior gains cannot be realized tax-free in an internal transaction. In addition, the capital gains tax exemption comes under pressure in the case of restructurings in which internal share transfers take place while the seller retains control, as there is no real transfer of ownership. Taking into account the tightening of the rules, it is wise to accelerate planned transfers or review existing structures. This will help you avoid tax surprises.

Due to the significant changes in the new rules, we always recommend seeking advice from your tax advisor. This way, you will receive accurate information and ensure that you are fully compliant with the tax obligations.

The investment deduction is a tax measure that encourages businesses to invest in certain new fixed assets. The investment deduction was recently reformed, with three tracks being used for investments starting Jan. 1, 2025. For each track, a fixed percentage applies by law, replacing the percentages that were indexed annually in the past.

Please refer to our previously published articles that discuss investment deductions in detail: The investment deduction has a new look from January 1, 2025. Therein you will also find the accompanying lists of investments eligible for this deduction: New investment deduction: investment lists published at the last minute.

Please note that these articles are only available in Dutch & French.

Taking into account the government’s plans to raise the 30% rate for “large” corporations under the increased thematic deduction to 40% (a rate that already applies to “small” corporations), for investments in energy, carbon-free transport and other environmentally friendly investments, it may be useful to postpone them for a while until the new rules come into force.

In the run-up to the end of the year, it is advisable to re-examine the transfer pricing policy within your company. Transfer pricing comprises the set of rules designed to ensure that (associated) companies within an international group mutually apply market-based prices and correctly allocate profits in intra-group transactions.

The basic principle here is that the prices applied should be market-based, as if the transactions were between independent third parties under the same circumstances. This is known as the arm’s-length principle. While prices and profits between independent companies are usually determined on arm’s-length terms, this is less obvious within a corporate group. Indeed, intra-group prices and the allocation of profits may be driven by tax or accounting motives. This increases the risk of both double taxation and forms of tax avoidance.

Transfer pricing has long been high on the agenda of tax administrations in Belgium and abroad. The way international groups structure their transactions directly affects the distribution of group profits between countries and thus the tax revenues of those countries. For companies that regularly engage in intra-group transactions, it is therefore essential to develop a sustainable and coherent transfer pricing policy.

We point out the above aspects because intra-group transactions between companies are often processed at year-end. It is important to ensure that these transactions are adequately substantiated so that the necessary documentation can be presented in the event of an audit.

If your company made too few tax prepayments during the year, a 6.75% tax increase applies. By making timely and sufficient advance payments, your company can neutralize this tax increase. So be sure to implement an optimal prepayment strategy!

For fiscal years that coincide with a calendar year, the last prepayment deadline is Dec. 22, 2025.

The tax shelter investment regime for the audiovisual, stage and video games sector can also be a useful addition or alternative to your prepayment strategy. This is especially true if the last prepayment deadline has passed: then a tax shelter investment proves to be a useful tool to still (partially) neutralize a possible tax increase. After all, it suffices to sign a framework agreement before the year end, even if the effective payment only occurs in a subsequent fiscal year.

A few years ago, car taxation rules were significantly changed as part of the greenification of mobility.

One of the pivotal points of the entry into force of these new rules is Jan. 1, 2026. As of this date, you should consider the following attention points:

• The existing deduction rules will be retained for company cars purchased, leased or rented before Jan. 1, 2023
• Starting in assessment year 2026, a phase-out scenario (see below) is provided for commercial vehicles purchased, leased or rented between July 1, 2023 and December 31, 2025.
• From Jan. 1, 2026, purchased, leased or rented company cars with CO2 emissions higher than zero will no longer be tax deductible for employers.
• Emission-free commercial vehicles remain 100% tax deductible.
• From 2026, the anomalous rule whereby for commuting, the deductible costs are set at a flat rate of 0.15 euros per kilometer will only apply to carbon-emission-free company cars and to company cars subject to the extinguishment or grandfathering scheme.

Phase-out scenario

The phase-out scenario cited above implies that the existing deduction scheme will continue to be applied temporarily, but in doing so, the lower limits of 40 and 50% for cars emitting at least 200 grams of CO2 per kilometer and those emitting less than 200 grams of CO2 per kilometer, respectively, will no longer apply.

Furthermore, an upper limit of 75% will be introduced, falling further to 50% in tax year 2027, to 25% in tax year 2028, and finally to zero deduction from tax year 2029.

As of assessment year 2029, company cars purchased, leased or rented between Jan. 1, 2023 and Dec. 31, 2025 are therefore subject to the general deduction scheme referred to in Article 66, § 1, paragraph 1, CIR 92.

Of course, this phase-out scenario applies only to cars with CO2 emissions. All zero-emission vehicles remain 100% deductible, no matter how they are acquired.

If you are considering purchasing or leasing a new car within your company in the near future (in the form of a hybrid car or car with a fuel engine), you would do well to get this sorted out before the end of this year. If you purchase or lease such car in 2026, then all associated costs are 100% tax non-deductible.

For the sake of completeness, we inform you that the date of purchase of a car is recorded on the date of signing the car order form. For a lease or rental, it is recorded on the date of signing the lease or rental contract.