Inheritance tax in Belgium: taxation of inheritance

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Inheritance tax in Belgium varies depending on where you live, and recent changes to inheritance rules could affect expatriates who work and own property in Belgium.

This guide to inheritance and inheritance tax in Belgium contains advice on the following topics:

Belgian inheritance law and inheritance rules

Belgian inheritance law is based on residence. This means that if Belgium is the country where you usually live and where your family and work are located, then its inheritance laws and Belgian taxes generally apply upon your death.

Inheritance law and inheritance tax in Belgium apply to the entire inheritance, including real estate held abroad.

However, it is possible for foreign residents to have their estate managed in accordance with the laws of their country of origin.

Rules of succession in Belgium

Belgian inheritance law follows a system of forced inheritance. This means that there are certain restrictions on how the deceased’s estate is distributed, with a certain percentage automatically passed on to heirs without the need for a probate order or court.

Rules introduced in September 2018 mean that the children of the deceased must share half of the estate, regardless of the number of children. The other half of the estate is passed on to a surviving spouse or partner for the rest of their life.

An overhaul of the inheritance rules has allowed people planning their succession to be more flexible on the implementation of agreements within their families.

The rules also cover how pre-death gifts are valued as part of an inheritance.

Rather than valuing assets based on the increase between the date of donation and granting of the inheritance, values ​​are now based on the asset’s value on the day it was donated, indexed to inflation at death .

Inheritance law for people without a will

If no will has been left, Belgian intestate law determines that the succession is divided into equal parts in the following order of priority:

  • Children and grandchildren
  • Parents and grandparents
  • Brothers and sisters and their relatives
  • Belgian government

The rights of the surviving spouse in situations where there are none will depend on the family situation:

  • If the deceased has one or more children, the spouse is entitled to receive dividends, interest and rent from the estate.
  • When there are no children but other legally recognized heirs, the spouse inherits the common property and has the right to collect interest on any private property belonging to the deceased.
  • If there are no heirs, the spouse inherits the entire estate.

Can we refuse an inheritance in Belgium?

All beneficiaries of an estate, whether they are heirs or testamentaries, can choose to accept or reject their inheritance. Under Belgian inheritance law, there are three options:

  • Accept an inheritance, that is, the obligation to pay debts even if they exceed the value of the estate.
  • Accept under beneficium inventarii (inventory profit), which means that debts cannot exceed the value of the estate.
  • Deny inheritance.

Accept under beneficium inventarii and the rejection must be pronounced by declaration at the registry of a Belgian court.

EU inheritance law in Belgium

Citizens of European Union countries can choose whether Belgian laws or those of their country of nationality apply to their inheritance upon their death.

Plenary hall of the European Parliament

If you are an expatriate living in Belgium and you want the inheritance law of your country of nationality to apply rather than Belgian inheritance law, you must express this clearly in a will or a separate declaration.

These laws then apply as long as they do not contravene local public policies (eg discrimination of heirs based on sex, discrimination of heirs based on being born out of wedlock).

EU rules do not apply to the following matters relating to your inheritance:

  • Inheritance tax in Belgium
  • Your civil status
  • The property regime of your marriage / partnership (i.e. how your assets should be divided after the death of your spouse / partner)
  • Business Concerning

Inheritance tax in Belgium

Inheritance tax in Belgium (erfdurable in Dutch or inheritance tax in French) is levied on all goods other than real estate outside Belgium (if the deceased resided in Belgium), and on real estate within Belgium (if the deceased was domiciled abroad).

There is an exemption from inheritance tax for diplomats residing in Belgium and working within the European Union or the North Atlantic Treaty Organization.

Belgian inheritance tax is paid on the net value of the estate. This is the total value of assets plus any corrections (for example, debts, gifts, life insurance policies) less any liabilities (for example, loans in progress, maintenance payments, hospital bills, fees. funeral, capital taxes paid abroad).

The inheritance tax is a regional tax and therefore varies from region to region. Belgian inheritance tax is paid to the region in which the deceased has resided for tax purposes for the majority of the last five years of his life.

Inheritance tax in Brussels in 2021

Tax deductions of € 15,000 apply to spouses and direct descendants / ascendants (with a supplement of € 2,500 per year for children under 21). All others can claim a tax exemption threshold of € 1,250.

Portion value Children, parents, spouse, grandparents, grandchildren Brothers Sisters Uncles, aunts, nephews, nieces Other heirs
Up to € 12,500 3% 20% 35% 40%
€ 12,500 to € 25,000 3% 25% 35% 40%
€ 25,000 to € 50,000 3% 30% 35% 40%
50,000 to 100,000 € 8% 40% 50% 55%
100,000 € to 175,000 € 9% 55% 60% 65%
175,000 to 250,000 € 18% 60% 70% 80%
250,000 to 500,000 € 24% 65% 70% 80%
€ 500,000 + 30% 65% 70% 80%

Inheritance tax in Flanders in 2021

Residents in Flanders benefit from a deduction of € 500 for inheritances of less than € 50,000.

Portion value Children, parents, spouse, grandparents, grandchildren Brothers Sisters Other heirs
Up to € 50,000 3% 25%
(up to € 35,000)
25%
(up to € 35,000)
50,000 to 250,000 € 9% 30% (from € 35,000 to € 75,000), then 55% 45% (up to € 35,000 to € 75,000) then 55%
€ 250,000 + 27% 55% 55%

Inheritance tax in Wallonia in 2021

The tax allowance for spouses and direct descendants / ascendants is € 25,000 for inheritances below € 125,000 and € 12,500 for inheritances over € 125,000 (with a supplement of € 2,500 per year for children under 21). € 620 excluding taxes are granted to all other heirs.

Portion value Children, parents, spouse, grandparents, grandchildren Brothers Sisters Uncles, aunts, nephews, nieces Other heirs
Up to € 12,500 3% 20% 25% 30%
€ 12,500 to € 25,000 4% 25% 30% 35%
€ 25,000 to € 50,000 5% 35%
(up to € 75,000)
40%
(up to € 75,000)
60%
(up to € 75,000)
50,000 to 100,000 € 7% 50% 55% 80%
100,000 to 150,000 € ten% 50%
(up to 175,000 €)
55%
(up to 175,000 €)
80%
150,000 to 200,000 € 14% 65% 70% 80%
200,000 to 250,000 € 18% 65% 70% 80%
250,000 to 500,000 € 24% 65% 70% 80%
€ 500,000 + 30% 65% 70% 80%

Taxes on family businesses transferred to inheritance

  • Brussels: Flat rate of 3% (if the company meets certain conditions of employment, investment and minimum shareholding).
  • Flanders : companies located in the EU are exempt if the deceased held at least 50% of the shares and if certain employment conditions are met.
  • Wallonia: Maximum rate of 3%.

Pay inheritance tax in Belgium

All heirs of an inheritance must file an inheritance tax return (aangifte van nalatenschap / declaration of inheritance), either individually or collectively.

Twenty euros close-up

Although it is possible to file it yourself, it can be complex; instead, you can ask a notary for help.

You will need to make this declaration at the local registry office where the deceased person lived (registratiekantoor / registrar). If you have rejected an inheritance, you should always notify the registrar.

If the person died in Belgium, you have four months to make the declaration. However, this drops to five months for people who have died elsewhere in Europe or to six months elsewhere in the world.

Double taxation rules in Belgium

Belgium does not generally grant any relief from double taxation in matters of inheritance tax. This means that assets may be subject to double taxation in certain circumstances.

Only inheritance tax paid on real estate abroad can be exempt from double taxation. Any other capital tax paid abroad can be deducted as an obligation from the equity in the estate.

Belgium has only concluded double taxation agreements with regard to inheritance tax with France and Sweden.

Transfer tax: inheritance tax for non-residents of Belgium

If the deceased was a non-resident, transfer tax is levied rather than inheritance tax. It differs in that it only covers Belgian real estate that the deceased owned. Funeral costs cannot be deducted from the overall bill.

In Brussels and Flanders, real estate debts can be deducted if the deceased was an EU or EEA citizen. In Wallonia, however, the country of origin and residence is irrelevant.

Although inheritance tax is not levied in Belgium, the deceased may be subject to the inheritance tax rules of their country of origin.

Reduce your Belgian inheritance tax

Belgium applies a three-year rule for donations of movable and immovable property. This means that if you give something to an heir and die within three years, then they will have to pay inheritance tax on the value of the donation.

Facades of houses in Bruges

If you register the donation with a notary at this time, you will need to pay donation tax instead. However, your heir will not be subject to inheritance tax on the gift.

Donation tax in Wallonia varies from 3.3% to 7.7%, depending on your relationship with the donor. In Brussels, the gift tax on real estate varies from 2% (up to € 50,000) to 30% (over € 500,000) for direct heirs. For movable property, it is 3% for direct heirs or 7% for other beneficiaries.

In Belgium, parents can donate goods to their child but retain the right to use it for the rest of their life. This means that they will be subject to gift tax at that time, but their heirs will not be subject to inheritance tax.

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