Frequently Asked Questions
What expenses can I deduct for tax purposes?
An expense is deductible if it is related to your professional activity, supported by documentary evidence, and incurred to obtain or maintain professional income.
Do I need to charge VAT as soon as I start my business?
In most cases, yes. However, certain activities are exempt, and small businesses may, under certain conditions, qualify for the VAT exemption program.
What is the corporate tax rate in Belgium?
The standard rate is 25%. Certain small companies may be eligible for a reduced rate of 20% on the first €100,000, provided they meet the requirements.
Salary or Dividends: Which Should You Choose?
Compensation is tax-deductible for the company but taxable for the executive. Dividends are paid after taxes and are generally subject to withholding tax. The right balance depends on your situation.
When should you switch from a sole proprietorship to a corporation?
The decision to incorporate often warrants careful analysis once profits become consistent and substantial. There is no automatic threshold: a customized simulation remains essential. The threshold at which there is a tax advantage to incorporating is generally when the business generates a pre-tax profit of at least 60,000 euros. However, this also depends on other factors, such as your other sources of income.
Can I get a VAT refund on all my purchases?
No. VAT is recoverable only if the purchase is related to a VAT-subject activity and meets the legal requirements. Certain expenses are excluded or subject to limitations.
Do I need to keep all my receipts?
Yes. Invoices, bank statements, contracts, and supporting documents must be retained for 10 years to prove the validity and business nature of the transactions.
Can I use my company's account for personal expenses?
You should avoid mixing personal and business expenses. Personal withdrawals must be properly recorded and documented.
How often should I check in with my accountant?
Regular follow-ups allow you to plan ahead for taxes, VAT, social security contributions, and cash flow needs. A quarterly check-in is often the minimum recommended.
Can Profiscal help me optimize my tax situation?
Yes. Profiscal analyzes your business, your income, and your plans to offer tailored, compliant, and tax-efficient solutions.