Agreement on the new capital gains tax on financial assets

The federal government agreed on the scope of the new capital gains tax on financial assets (also referred to as solidarity contribution). This agreement must still be translated into formal draft legislation.

The new capital gains tax

The new capital gains tax would apply to capital gains realized by an individual (and some not-for-profit organizations) upon a transfer for consideration of a qualifying financial asset or a transaction assimilated thereto.

Qualifying financial assets

Qualifying assets would include the following categories of assets: financial instruments, some insurance contracts, crypto-assets, and currency. 

Financial assets subject to a tax reduction for long-term savings, as well as those already taxable as professional or movable income, would not be subject to this new tax. This includes, amongst others, second and third pillar pension pay-outs.

The contemplated exemption for capital gains on financial assets held for more than 10 years was also left out.

Taxable basis

The capital gain would be calculated based on the following principles:

• It would be calculated as the difference between the realisation value and the acquisition value of the financial asset.

• A step-up of the acquisition value based on the value of the underlying asset per 31 December 2025 would apply if this value is higher than the acquisition value. Modalities to determine the latter value will be included in the legislation.

• Capital losses can be deducted from capital gains realized in the same year on the same category of assets.

Rate

The above capital gains would be taxed as follows:

• As a rule, taxation at a 10% rate, with a yearly exemption of EUR 10,000 (which can increase up to EUR 15,000 in specific circumstances).

• In the event of substantial interest (i.e. at least a 20% participation, which is now determined per taxpayer rather than per family), a first tranche of EUR 1,000,000 would be exempt, the outstanding taxable gain being subject to progressive rates ranging from 1.25% to 10%. In the event of a sale of such a participation to a non-EEA company, the taxable gain would be subject to a distinct 16.5% rate.

• In the event of internal capital gains realized upon a qualifying sale of a participation to a company that the seller controls (alone or together with its family), the underlying capital gain would be taxable at the rate of 33%.

• Capital gains that result from abnormal management of one’s private patrimony (e.g. speculation), would remain subject to the existing 33% tax rate. This is contrary to previous versions of the draft law where the new solidarity contribution replaced the 33% rate.

Levy

The tax would be levied via a withholding tax by Belgian intermediaries (banks, …), unless the taxpayer opts out. In the absence of Belgian intermediary, the taxpayer should report the capital gain in its income tax return. The yearly exemption or the deduction of capital losses would always need to be claimed via the income tax return. 

Exit tax

If the tax residency of a Belgian taxpayer is transferred abroad, or assets are transferred to a recipient abroad (e.g. through a donation), the latent capital gain upon that transfer is taxable in Belgium if the underlying financial asset is disposed of within two years following the transfer abroad. 

Reynders Tax

While an abolition of the so-called Reynders Tax (Article 19bis ITC) and a reduction of the insurance premium tax were considered in previous draft texts, none of these were retained in the government agreement reached, and the existing provisions therefore remain applicable.

The Reynders Tax would remain in place and would be applied together with the new capital gains tax on financial assets, i.e. the interest component of capital gains realized on investment funds in scope of the Reynders Tax will be taxable at 30% and the remainder of the capital gains exceeding the 10KEUR/15KEUR exemption threshold will be taxable at 10%. This implies that reporting requirements in respect of investment funds in scope of the Reynders Tax (i.e., Asset Test and TIS computations) would still be required going forward. 

Entry into force

The new tax would enter into force as of 1 January 2026.

Impact and next steps

This new legislation could impact a broad range of stakeholders and situations:

• Individual investors

• The capital gains tax consequences will need to be considered in estate planning, such as in case of donations to non-Belgian beneficiaries or beneficiaries moving abroad (e.g. for studies or work).

• Companies granting employee stock options or shares (The text of the agreement so far does not foresee anything specific around incentive plans, so this requires further monitoring what the concrete impact will be).

• (Belgian) financial institutions, who will have to manage most of the underlying new compliance burden

It is expected that the final draft legislation will still have to be validated by the Council of Ministers and afterwards sent to the Council of State.