Open REIT in Belgium

The REIT Belgium is a commercial company established with the purpose of allowing investors to access a diverse portfolio focused on real estate investments. In Belgium, this achieved in the form of a regulated real estate company regime (the RREC), however, this is the equivalent of the real estate investment trust (or REIT, used herein) common in many other jurisdictions around the world.

The Belgian Real Estate Investment Trust

1. company type: investors need to use a public limited liability company for the purpose of creating a real estate investment trust (société anonyme/naamloze vennootschap);
2. capital: in general, the minimum share capital for the legal form is 1.2 million EUR;
3. requirements: there is a mandatory requirement for the company to be listed on the stock exchange; therefore, it will observe all the listing rules; a diversification rule is in place;
4. restrictions: at least 30% of the shares in the public REIT Belgium are held by the public; there are no restrictions on the type of investors, not restrictions on the investor’s place of residence;

The tax treatment of the REIT Belgium

• Corporate income tax: the legal entity is subject to the applicable corporate income tax rate, with a value of 29%;
• Exit tax: this applies when a regular company is converted into a real estate investment trust or when a re-organization of a trust is performed; the value is 12.75% and our team can give you more details;
• Withholding tax: in most cases, a 30% withholding tax applies on dividend distributions, both in the case of individual or corporate recipients; this rate can be reduced in some cases, such as when the real estate investment trust invests part of their assets in certain types of properties, such as healthcare properties;
• Other issues: taxes on stock exchange transactions can apply and a 0.0925% annual tax is in place for these types of entities.