The Value-added tax (VAT) in Belgium must be paid by any person or entity that provides goods or services to the Belgium market.
The standard rate for VAT in Belgium is 21% and it hasn’t changes since 1996. The country also benefits from reduced VAT rates of 12% for social housing and meals, among others, and 6% for food, drinks, and various types of services, transportation or pharmaceuticals. Newspapers and magazines are exempted from VAT in Belgium.
Before starting its activity, any company must register for VAT in Belgium. The company owner or VAT representative should file a declaration with the VAT office in the resident location, announcing the beginning of the company’s activity. The procedure is considered complete only when a VAT number is issued in the form of ten digits following the country code BE. This number must be mentioned in all official documents, including contracts, invoices, order forms and others.
Almost all taxpayers are entitled to VAT refund from the Belgium Administration, according to the law. Cars are only 50% deductible, while categories like accommodation costs and tobacco are not refundable. If an investor wishes to claim a VAT refund he must submits his enquiry to the tax office in person or electronically. Filling the application form doesn’t require registration but the authorized person or representative appointed by a power of attorney must present the invoices. The application can be submitted in French, English, Dutch or German.
When importing goods in Poland an intra-community acquisition document should be filled, however due to Belgium’s membership in the European Union, transactions in intra-community space are usually zero-rated when it comes to VAT. However, if the company from an EU Member State sells and delivers goods with a value exceeding a threshold of EUR 35,000, it will be required to register for VAT in Belgium.
EU companies can opt to become VAT registered in Belgium if the input VAT incurred in Belgium regularly equals or exceeds the amount of EUR 10,000 on a yearly basis.
If a company delays VAT registration in Belgium, it will be charged with an interest of 0.8 percent per month. If the company fails to register for VAT it might be fined with a penalty of EUR 500.
Starting with 1 April 2007, Belgium adopted the VAT group system. This means that independent Belgian established legal entities can be enabled to be treated as a single. The major advantage is that transactions that take place between the entities that belong to the same group are VAT exempted in Belgium.
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