Belgian Expat Tax Regime: Critical Changes Effective 1 January 2025 for income tax; No adjustment for social security

On December 12, 2025, Parliament has approved significant amendments to Belgium’s special tax regime for inbound employees and researchers. While awaiting Official Gazette publication, these changes take effect retroactively from 1 January 2025, requiring immediate action from organisations enabling expatriates seeking to benefit from the regime.

Key Highlights of the Reform

Increased Cost Allowance

Maximum Cost Allowance rises from 30% to 35%, enhancing the regime’s attractiveness.

Abolition of the EUR 90,000 Cap

The previous ceiling of cost allowance is removed, allowing the 35% exemption to apply without limitation. This is a major benefit for high earners.

Lower Minimum Salary Threshold

The minimum gross annual salary requirement decreases from EUR 75,000 to EUR 70,000, broadening access to the regime.

These enhancements strengthen Belgium’s competitive position in attracting and retaining international talent.

No alignment for Social Security

On 22 December 2025, the Belgian social security authorities announced in their interim instructions 2025/4 that the Royal Decree of 28 November 1969 will not be changed. As a result, the social security contribution rules (RSZ) will stay the same from 1 January 2025 as they were on 1 January 2022. This means the maximum 30% cost allowance exempt from social security contributions and the EUR 90,000 annual limit will still apply.

Transitional Provisions for 2025 Starters

The amendments apply retroactively to individuals starting employment from 1 January 2025, especially those with gross salaries between EUR 70,000 and EUR 75,000 (subject to qualifying conditions). A dedicated catch-up window allows late applications within three months from the 10th day following Official Gazette publication.

Practical Implications & Next Steps

The increase to 35% and removal of the EUR 90,000 cap significantly affect payroll calculations, particularly given the lack of alignment with social security rules. Additionally, these changes have contractual implications.

Strongly Recommended Immediate Actions:

• Review 2025 year-end payroll runs to capture retroactive benefits and prepare for 2026 instructions

• Update contractual arrangements to reflect and leverage the changes.

• Review existing contractual arrangements: Recent audits have shown narrow interpretations by tax authorities regarding cost allowance application and contractual wording.

Timing is critical. Act now to ensure full benefit from these important changes and ensure compliance!