Chapter 4: Finance and accountancy

Finance and accountancy in Belgium

This chapter covers all finance-related issues, including basic information on tax rates, allowable business expenses and deductions, top tips for maximising your efficiency, accounting rules for dummies (including legal requirements) and a short explanation of the VAT regime in Belgium.

In Belgium,  if you are running your own small business you are liable for four types of tax:

  1. Personal income tax
  2. Corporation tax
  3. Social security
  4. Value Added Tax (VAT)

This chapter looks at how much you can expect to be paying in these categories so that you can draw up a realistic budget.

Allowable expenses

A business expense is defined as any expense incurred for earning or safeguarding income unless specific provisions limit the deductibility.  This chapter covers some of the main types of expense that you can expect to incur.

Choosing an accountant

Selecting an accountant seems to represent the biggest start up challenge for many budding entrepreneurs so we have compiled this handy list of questions that you can use to interview any accountant that you are thinking of engaging.

  1. Will you take the time to sit down with us at the beginning of our relationship and also at other times when we need to understand the Belgian context of handling all accounts for the company (and us personally), and so that you fully understand the objectives and working methods of our company?
  2. Will you also take the time to meet with us before the filing of the annual accounts to walk us through your advice and to make sure it makes sense for us?
  3. What is your expected turn-around time when we call or email you with a question?
  4. Will you explain, in terms that a non-Belgian can understand, what is the system of income tax pre-payment in Belgium, and will you tell us when to send an estimated income tax payment?  When you do tell this to us, will you agree to do it by email with everything we need to know to do the bank transfer immediately, like the date (giving us at least a week’s notice), the bank account number, address of the receiver and the code numbers)?
  5. When information or action is needed on an issue, will you give us at least 10 days notice and prioritise it by letting us know if it’s of “code one” importance so that we have time to react?  Please do not expect us to drop everything and act at the last minute.
  6. Will you handle all correspondence and communications with tax authorities and inform us of this?
  7. When you complete the annual corporate income tax returns, will you check it with us in advance for clearance and then sit down with us to walk us through it in greater detail – in English?
  8. Will you on a regular basis examine our systems and offer advice as to ways to maximise the use of the company for tax minimisation, paperwork reduction, and so on?
  9. What is your particular area of expertise?  How big is your firm?
  10. Does the firm have help available at lower billing rates?  What are your hourly or monthly or yearly rates?
  11. If applicable:  Will we need you to prepare monthly sales tax returns and send then to our office for signature and payment?
  12. If applicable:  Will you prepare monthly payroll tax returns and tell us when we have to make deposits?
  13. If applicable:  When you do monthly, quarterly, and annual payroll tax returns, will you need any input from us?