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Holding Company in Belgium

Holding Company in Belgium

A Belgian holding

holding company in Belgium is a type of company that is focused not on producing goods but on acquiring and managing the shares in otter companies and controlling the companies. Holdings have the role of structuring and controlling the organization and financing of a group of companies.

Holding companies can also perform other activities, such as commercial transactions or property purchases and transactions. Foreign ownership for holdings in Belgium is permitted and foreign investors who want to open a Belgian company can request the services of our company incorporation specialists. 

The most commonly used types of Belgian holding companies are the public limited company (Société Anonyme, SA, naamloze vennootschap NV) and the private limited company (Société Privé à Responsabilité Limitée, SPRL, besloten vennootschap met beperkte aansprakelijkheid, BVBA). It is also possible to change the company type of a holding company in Belgium. 

In order to register a public limited company (SA), a minimum share capital of 61,500 EUR is required and at least one-quarter of the initial share capital must be paid upon incorporation. On the other hand, for a private limited company (SPRL), the minimum share capital required is 18,550 EUR and at least one-third (6,200 EUR) must be paid upon incorporation. If you require further information on these types of Belgian holding companies, our team of experts in company registration in Belgium can provide you with assistance.

QuickFacts  
 Belgium holding company – definition A type of company that manages and controls the assets and investments of its subsidiaries from Belgium or abroad 

 Minimum number of shareholders 

 At least 1

 Minimum number of directors 

 At least 1

Accounting and Audits   Belgian holding companies are required to file their annual accounts, management report, and auditor's report with the National Bank of Belgium within 30 days of their approval by the Annual General Meeting (AGM) and no later than seven months after the end of the financial year.
 Taxes

Corporate tax rate of 33,99%; Companies that pay corporate tax in Belgium can benefit from the notional interest deduction

 Advantages for Belgium holding companies

 Foreign ownership;
Dividends received by a Belgian holding company may be subject to a reduced corporate tax rate;
Holding companies can have lesser risks and reduced exposure compared to their subsidiaries;
Holding company registration in Belgium has been simplified in recent years

VAT 

Typically does not engage in business activities that require VAT Registration in Belgium, but might exist some exceptions depending on Case C-85/11  specifics 

 Liability

 Group liability can arise when a company controls or manages another company and performs acts or omissions that violate the law or the controlled company's by-laws;
Liability may also extend to third parties who benefit from these acts or omissions.  

 Company formation

Documents will be submitted by the law firm in Belgium to the Belgian Crossroads Bank for Enterprises (KBO/BCE) and obtain a company registration number (RPM/TVA). 

 Time frame for the incorporation (approx.) 1-3 weeks 
 Number of double taxation treaties (approx)

 80

 Annual meeting required (Yes/No)

 Yes

 Local director required in Belgium (Yes/No)

 No

 Dividend tax rate 

95%  exemption on dividends (if the minimum shareholding for one uninterrupted year in full ownership);

Exemption of withholding tax on dividends paid to companies within the EU or to companies located in a country that has signed a double tax treaty with Belgium (if the minimum shareholding for one uninterrupted year in full ownership);

Dividends paid to related European companies are exempt from withholding tax (if the minimum shareholding for one uninterrupted year in full ownership) 

 Legal entities used  Private and public limited liability companies;
Limited partnerships;
Trusts and foundations 
Legal system for holding companies Belgium does not have a dedicated legal framework solely for holding companies.

Corporate income tax

25%

Control

A holding company can still control its subsidiaries without owning every single share or membership interest in those subsidiaries.

Restrictions on currencies (YES/NO) NO

Structure of a holding company

– holding company (central unity),

– operating company

Participation exemption regime

Can help companies avoid paying taxes twice on the same profits when they receive dividends from other companies.

Liquidation of a holding company

We can help you in opening a company in Belgium, but also assist in the liquidation of a holding company.

Minimum capital

None for private limited company

Local director required in Belgium (YES/NO)

NO

Company name requirements

Generally includes “holding company”

Address requirements

Must be located in Belgium

Local bank account

Recommended

Hiring employees

It is possible, but it can impact the tax and legal structure of the holding company.

VAT Registration in Belgium

Depends on the specific business activities

Assistance

Our team can help you with company formation in Belgium and assist in every step.

Holding company incorporation in Belgium

Holding companies in Belgium can be incorporated as a company limited by shares – SA or a private limited company SPRL. The minimum share capital depends on the chosen business form. These companies are subject to the normal corporate tax rate of 33.99%. The Belgian holding company has to observe the holding requirements for taxation (10% of the corporate tax) but does not need special approvals and particular controls.

Belgian holding companies benefit from the double tax treaties signed between Belgium and other counties.

Dividends sent by a Belgian holding company to a parent company in another country are taxed at either 21% or 25%. 

However, if a Belgian holding company receives dividends from a foreign country and the EU Directive Parent-Subsidiary applies, reduced tax rates will be imposed. For EU subsidiaries, the Belgian company will be exempted from corporate tax if it holds at least 10% of the foreign company’s shares for one year or more. For non-EU subsidiaries, only 5% of the received dividends will be subject to corporate tax if certain conditions are met, such as holding at least 10% of the company’s shares or having profits that are taxed at a minimum rate of 15%, and the subsidiary is not incorporated in a country where corporate taxes are lower.

In Belgium, capital gains are not taxed if the dividends qualify for a participation exemption and the interest withholding tax is fixed at a rate of 21%.

Our team of experts in company formation in Belgium can provide you with more detailed information regarding taxes for Belgian holding companies.   

Liability for Belgian holding companies

Belgian holding company can be held responsible for the debts of its subsidiary if it ignores the concept of keeping the companies separate and commits faults that contribute to the subsidiary’s insolvency. 

The subsidiary’s directors can also be held liable for management faults or violations. The holding company must act in the best interest of the subsidiary, but it’s allowed to consider group interests if it benefits the subsidiary too. Note that also depending on the activities of the holding companyspecial licenses and permits may be required in Belgium. 

It’s important to seek professional advice when forming a Belgian holding company to avoid potential liabilities. We can help you with all details regarding the Belgian company formation.

Advantages of a holding company

Dividends received by a holding company can be subject to a reduced corporate income tax (95% exempt) if certain criteria ate satisfied. There is also a capital gains exemption if the dividends qualify for the participation exemption. Our company registration experts in Belgium can give you details about the dividends exemption for EU and non-EU subsidiaries. The holding company can enjoy an exemption on company liquidation and an exemption from the withholding tax on payment of interest. 

A benefit offered by owning a holding company is lesser risks and reduced exposure. The holding can use its relationship with the subsidiary to secure loans and to create collateralized loans. The holding company can use its power derived from owning shares in subsidiaries to set corporate policies, but not necessarily to interfere with the management of these companies.

Our company registration experts in Belgium can help you with more information about Belgian holdings. You can contact us if you want to open a Belgian company and are interested in additional matters, like taxation in Belgium.

Belgium also has a highly developed legal and financial infrastructure, making it a favorable location for businesses looking to establish a holding company. The country’s strategic location in the heart of Europe also makes it an attractive location for businesses looking to expand their operations across the continent. Government laws also offer several legal structures for holding companies in Belgium, such as the public limited company, private limited company, and the cooperative company. This allows businesses to choose the legal structure that best suits their needs.

While a holding company is not subject to VAT registration in Belgium for its activities (as it does not engage in commercial ones), investors who are interested in opening other types of companies that are subject to this tax can reach out to our team. We provide information on the rates and the registration which is mandatory before the commencement of the activities. 

Here are some interesting facts and data about Belgian holding companies and why Belgium is an excellent destination for investments:

  • • Holding companies, along with families and industrial companies, are the main investor categories in Belgium;
  • • Family-owned companies represent 44% of the companies in Belgium, according to the 2022 Belgium Spencer Stuart Board Index;
  • • In 2021, there were approximately 682,600 businesses operating in non-financial industries in Belgium. You can discuss more options about opening a Belgian company with one of our specialists;
  • • The leading industries in Belgium are metallurgy, steel, textiles, chemicals, glass, paper, and food processing; 
  • • Although Belgium has a strong industrial presence, services make up 74.9% of the country’s GDP. 

CompanyFormationBelgium is a part of Bridgewest company, a European Company Formation agent with offices all over the world. For our clients who need legal services in other countries, we recommend our reliable teams from all around the world, such as consultants from GermanyAlbaniaAustriaSwitzerland or Montenegro.