Since the 2021 tax year, an individually deductible percentage has been calculated per car on the basis of CO2 emissions and fuel type, adjusted in some cases to take account of minimum and maximum percentages.

Hybrid cars will be subject to separate maximum deduction rates from 1 January 2025 that are different from those for other cars using fossil-fuels. These will be the same during ‘the vehicle’s entire useful life with the same owner/lessee’, which suggests that the maximum percentage will depend on the year of purchase / commencement of use. For hybrid cars, there is a maximum tax deductibility:

• 75% for cars purchased/commissioned until 31 December 2027;
• 65% in 2028;
• 57.5% in 2029.

The fossil fuel costs of hybrid cars, which have been up to 50% deductible since 2023, will remain capped at 50% deductible until 31 December 2027. The electric consumption costs of hybrids get the same maximum deductibility as those for electric models: from 95% for cars purchased in 2027 to 67.5% for cars purchased in 2031.

Fuel costs for passenger cars, dual-use cars and minibuses will no longer be deductible as business expenses from 1 January 2026, regardless of the date of purchase, rental or leasing of the vehicle.

This rule is included in the Law on Miscellaneous Provisions of 18 December 2025 (category 1) and applies from 1 January 2026 (via Amendment No. 1127/009).

The programme law of 18 July 2025 (category 1) made changes to the VVPR-bis and liquidation reserve regime. Its purpose is clear: to create a more neutral and coherent framework for profit distributions, eliminating inequalities between the two regimes as much as possible.

For liquidation reserves created before 1 January 2026, the following rules apply:

• A distribution at 5% securities withholding tax is possible if the reserve is maintained for at least five years from the last day of the taxable period in which it was created (unchanged).
  
  
• When the reserve is maintained for a period of between three and five years, starting from the last day of the taxable period in which it was created, a securities withholding tax of 6.5% applies.
  
  
• If the liquidation reserve is maintained for less than three years from the last day of the taxable period when it was created, a securities withholding tax of 20% will be payable.

For liquidation reserves created from 1 January 2026 onwards, there is only one remaining option to enjoy a lower securities withholding tax of 6.5%. Distribution at this rate is possible after maintaining the reserve for a period of at least 3 years counting from the last day of the taxable period when it was created. The 5% securities withholding tax rate is therefore being raised to 6.5%. This increase raises the overall effective tax burden on distributions from a liquidation reserve from 13.64% to 15%.

This increase applies to dividends awarded or becoming payable from 29 July 2025.

For earlier distributions, the securities withholding tax will be 30 per cent. In case of liquidation, the securities withholding tax on distribution is still 0%.

During 2026, further details will also be developed in the preliminary draft of the new programme law (category 2) on the increase in the rate of securities withholding tax to 9.8% in the liquidation reserves system. Due to this announced rate increase, the distribution of a liquidation reserve in its entirety will have suffered an effective charge of 18%.

Companies will therefore be able to distribute their liquidation reserves more quickly, but this will be accompanied by an increase in the tax cost. Failure to comply with the waiting period will become considerably more costly.

When a dividend is awarded or appropriated from the profit distribution of the third financial year (or a subsequent year) after the year of the contribution, the VVPR bis dividend is taxable at 15%.

The securities withholding tax is 20% for VVPR bis-qualifying dividends appropriated from the profit distribution in the second financial year after the year of the contribution. This reduced rate of securities withholding tax will only be maintained if this contribution is made before 31 December 2025.

For contributions after that date, a dividend awarded from the profit distribution for the first or second financial year after the contribution will be subject to a withholding tax of 30%. From the third financial year, the securities withholding tax will be 15%.

To eliminate disparities between the liquidation reserve system and VVPR bis dividends, a rate increase was also announced here, to be detailed further in the preliminary draft of the new programme law (category 2) during 2026. Specifically this is reported to be a rate increase in the VVPR bis regime from 15% to 18% for dividends from the distribution of profits for the third financial year following the contribution.

The draft law (category 2) to introduce a tax on capital gains on financial assets (including securities, investment funds, ETFs, derivatives, branch 21/23/26/44 insurance – excluding residual balance and funeral insurance – and crypto assets, etc.) dated 17 December 2025 aims to introduce a tax from 1 January 2026 on capital gains realised outside the exercise of a professional activity and arising from the normal management of private assets.

These capital gains were previously exempt. These capital gains will be taxed as miscellaneous income. Abnormal management of private assets or more specifically speculative transactions remain taxable at 33%.

 

The capital gains will be calculated by deducting the acquisition cost of the financial assets from the sale price received. Costs relating to the disposal or taxes are not deductible. To calculate this acquisition value, the starting point will be the value of the assets on 31 December 2025 (e.g. closing price, valuation formula in contracts, EBITDA multiple for shares, etc.). If the original acquisition cost is higher than this value, it may be used for the calculation of capital gains until 31 December 2030, provided evidence is submitted. Historic capital gains (accrued before 1 January 2026) remain exempt.

 

The capital gains tax system has both general and special regimes, depending on the participation rate of the taxpayer. Specific tax rates have been worked out for each regime.

 

The general regime targets all capital gains on financial assets that do not fall under the other two special regimes. Under this regime, every taxpayer benefits from an annual basic exemption of EUR 10,000 (indexed) of capital gains. Moreover, that basic exemption would also be transferable (to a limited extent). If the first EUR 1,000 bracket of the exemption is not used in a taxable period, the unused portion of this first EUR 1,000 can be carried forward to subsequent taxable periods.

However, the total exempt amount brought forward that can be added to the original base exemption of EUR 10,000 cannot exceed EUR 5,000 (five times the maximum base exemption to be transferred per taxable period). A tax rate of 10% is charged on amounts above this exemption.

The first special regime provides a special regime for shareholders with a substantial interest of 20% or more. They can benefit from an exemption of up to EUR 1 million. However, the amount of this exemption can only be used once in each period of five consecutive years. In other words, taxpayers cannot apply the EUR 1 million exemption every year (e.g. if the taxpayer has a substantial interest in several companies or transfers a participation over several years). If the exempt bracket is already fully used up in the “first year”, the taxpayer will therefore no longer benefit from the exemption in the following four years. For amounts above this threshold, a progressive graduated rate is applied:

• 1.25% on capital gains between EUR 1 million and EUR 2.5 million;
• 2.50% on capital gains between EUR 2.5 million and EUR 5 million;
• 5% on capital gains between EUR 5 million and EUR 10 million;
• 10% on capital gains above EUR 10 million.

 

When selling to a non-EEA entity, a rate of 16.5% above the first exempt bracket of EUR 1 million applies. The conditions are that this only applies to shares (not profit-sharing certificates) and the 20% threshold must be assessed for the individual transferor at the time of the transfer.

 

In the second special regime, there is a specific provision for internal capital gains. These are capital gains realised when one or more individual shareholders transfer their direct stake in a company to another (holding) company that is also controlled by the transferor, either alone or together with close relatives. Internal capital gains will fall under miscellaneous income and will be taxable at 33%.

 

Capital losses of the same type realised by the same taxpayer within the same year can be offset, but carrying forward of losses to subsequent years is not allowed. As a result, capital losses on financial assets (which do not constitute a substantial interest) will not be deductible from capital gains in the context of a substantial interest.

 

In principle, the new capital gains tax applies to the "transfer for valuable consideration" of financial assets falling under one of the three regimes. Gifts or transfers on death will therefore be out of scope.

 

Exemptions include:

• Certain reorganisations of investment funds;
• Second and third pillar pensions;
• Capital gains on contribution of shares;
• Income that is already taxable on a different basis;
• Income already taxed under the Cayman tax;
• Dissolution within 3 years of death/divorce/termination of legal cohabitation.

 

The collection of the new capital gains tax will be done through the introduction of a 10% securities withholding tax that provides discharge. The securities withholding tax is deducted by intermediaries (e.g., banks, insurers, etc.) based in Belgium that are involved in the transaction. The withholding tax does not apply to capital gains on crypto assets, currency, internal capital gains or capital gains within the "substantial interest" type.

 

Intermediaries are not allowed to take into account the EUR 10,000 (up to EUR 15,000) exempt bracket, deductible capital losses or higher historical acquisition value when calculating securities withholding tax. These adjustments are only offset via the personal income tax return. In situations where the intermediary has no knowledge of the acquisition cost, the securities withholding tax should be deducted from the full price received. Taxpayers can subsequently prove the actual value via their tax return.

 

The securities withholding tax has a discharging effect, meaning that taxpayers in principle do not have to disclose the relevant capital gains in their returns. They can, however, do so if they wish to claim an exemption or correction. They only have to declare capital gains for which an exemption is sought, i.e. not all realised capital gains.

 

Since the securities withholding tax may lead to pre-financing, an opt-out is also provided. Taxpayers can choose not to have securities withholding tax withheld. The intermediary must be informed of the opt-out by 30 June 2026 and it applies retrospectively for the entire 2026 income year. The choice remains valid until it is revoked by at least one holder, which can only be done once a year.

 

Whoever uses the opt-out will be required to declare these capital gains.

The new capital gains tax will take effect for all capital gains realised from 1 January 2026. A different date of entry into force applies to the securities withholding tax. Deduction of securities withholding tax from taxable capital gains will not begin until the 10th day after publication of the law, which has yet to appear in the Belgian Official Gazette.

For capital gains realised between 1 January 2026 and that date, securities withholding tax therefore cannot be withheld by financial intermediaries. As a result, taxpayers would, in principle, have to declare these capital gains. To avoid this, the draft law provides an option for the taxpayer to voluntarily deposit an "amount equivalent to the securities withholding tax" via a financial intermediary ("opt-in").

This request must be submitted by all holders of the relevant account or policy by 30 June 2026, after which the amount must be transferred by 30 September 2026 at the latest. This equivalent amount is treated as real securities withholding tax, i.e. it is available for offset, may be refundable and discharges the taxpayer from the obligation to file a tax return. However, financial institutions are not obliged to offer this service and they only have a short time to process these deposits.

Finally, a specific transitional rule applies to securities withholding tax on other capital gains. For capital gains realised between 1 January and 30 June 2026, securities withholding tax is not due until 30 September 2026 at the latest, giving intermediaries enough time to adjust their processes. From 1 July 2026, the normal 15-day period will again apply.

The legislature extended the existing exit tax in the corporation tax system to personal income tax. When a company moves its management office to another country, it is deemed to have been liquidated and dissolved for Belgian corporation tax purposes. As a result, unrealised capital gains present in the company are deemed to have been realised and are taxed.

 

This legal fiction will now be extended to shareholders and it will apply to transactions from 29 July 2025 via the 18 July 2025 (category 1) programme law. In a cross-border transfer of office, merger, demerger and other restructuring where assets are no longer used or held in Belgium, shareholders are taxed as if a liquidation has taken place (“liquidation dividend”).

 

Please note that this happens regardless of whether an actual distribution has taken place. Since this is a notional dividend distribution, the tax cannot be collected through the securities withholding tax. This requires the shareholder to declare it on their personal income tax return. Companies must issue individual statements to their shareholders. In case of non-compliance, an additional charge will be levied at the company's expense.

 

Upon subsequent realisation of the actual capital gains and actual payment of a dividend, a credit mechanism (tax credit) is provided to avoid double taxation.

 

Finally, to ensure conformity with EU law, it is possible to opt for immediate payment of the tax due or deferral of taxation, as in the case of corporation tax.

This is an annual fee applicable to securities accounts with an average value of more than EUR 1 million. All financial instruments and cash in a securities account are within the scope of the tax (including shares, bonds, investment funds, savings certificates, trackers, swaps, options, cash, etc.). Certain insurance products are also indirectly subject to the securities tax because the insurance company holds the underlying assets in a securities account.

The programme law of 18 July 2025 (category 1) introduces a new requirement to disclose any conversion or transfer of financial instruments in a securities account when the legal conditions are met. An anti-abuse provision is also introduced for situations involving conversion or transfer. This will now be subject to a rebuttable presumption of abuse. However, there is no abuse when the transaction occurs in the context of a gift to children or when a split takes place outside the will of the parties involved, for example in a divorce.

The reporting obligation applies to Belgian intermediaries or recognised liable representatives or if the account is managed abroad without a representative: to the holder of the securities account. The notification deadlines can be summarised as follows:

• If the end of the reference period is no later than 31 October 2025: the deadline for notification falls on 31 December 2025 (administrative tolerance: deadline extension to 31 January 2026);
  
  
• If the end of the reference period is after 1 November 2025: the deadline for notification falls on the last day of the month following the end of the reference period.
  
  
• Another administrative tolerance provides an additional period until 30 April 2026 to replace, if necessary, an initial notification without a unit value with a full notification indicating the unit value of the financial instruments transferred or converted.

 

The scheme also comes into force as of 29 July 2025; all transactions carried out since that date must be reported to the administration.

Finally, according to the latest budget conclave at the end of 2025, it was discussed that there will be an increase in the annual securities account rate (from 0.15% to 0.30%).

Since 1 January 2023, the tax rules for the treatment of copyright have been thoroughly reformed. One major change was the tightening of the fiscal definition of “copyright”, which meant that, among other things, the IT sector could no longer use the favourable regime.

This tightening led to considerable criticism in legal doctrine and numerous arguments in the courts. Finally, on 16 May 2024, the Constitutional Court confirmed that computer programmes and software are effectively outside the scope of the fiscal copyright regime.

Despite that jurisprudence, the coalition agreement has again stated that the tax regime will be extended to digital professions, specifically for work involving computer programmes protected under Book XI, Title 6 of the Code of Economic Law.

A draft law in the context of the reform of personal income tax (category 2) is currently being prepared. This draft law stipulates that the preferential copyright regime will again apply to revenue derived from the transfer or licensing of computer programmes.

However, the current drafts show that the government wishes to abolish the flat-rate copyright cost deduction from the 2026 income year. Up to now, authors benefited from a low flat rate of 15% and a flat-rate cost deduction of 50% on the first income bracket and 25% on the next. This arrangement resulted in an effective tax burden as low as 7.5% in some cases. This measure in the draft now completely removes the flat-rate cost regime. Only actual expenses would still be deductible.

However, it turns out that this abolition has not been applied across the board. The flat rate for costs will be retained for authors who have a work of art certificate. This certification already has a role within the tax regime, as an author in principle has to prove that copyrights are transferred or licensed for communication to the public, public performance or reproduction.

Authors who have a certificate are exempt from this requirement to present evidence. The impact of this has been limited so far, since most taxpayers using the scheme do not have such certificates so it is not a necessary condition for applying the preferential regime.

However, this draft text now gives much greater fiscal significance to the work of art certificate. The flat-rate cost regime will now be retained only for authors who have such an attestation. As a result, the attestation becomes the decisive criterion for accessing the flat-rate cost deduction of:

• 50% on the first indexed bracket (EUR 20,100 for the 2026 tax year);
• 25% on the second bracket from EUR 20,100.01 to EUR 40,190.

Belgium's special tax system for incoming taxpayers and researchers has already been thoroughly reformed in recent years. Since the abolition of the old expatriate regime in 2022, this new system is a crucial lever to attract international talent. The Miscellaneous Provisions Act of 18 December 2025 (category 1) further broadens and optimises the framework. The changes will take effect from 1 January 2025.

Up to the end of 2024, an inpat was required to receive at least EUR 75,000 gross annual remuneration. From 1 January 2025, this threshold will be lowered to EUR 70,000. For researchers there is still no minimum remuneration requirement (unchanged).

For a long time the inpatriate regime has provided for a tax-free allowance of 30% on gross annual remuneration, with a maximum of EUR 90,000 per year. Two aspects of this are now changing:

• The remuneration rises from 30% to 35%;
• The absolute maximum ceiling of EUR 90,000 disappears.

An important point to note here is that in terms of social security law, the National Social Security Office (hereinafter: NSSO) is not (currently) following this increase.

Since the wage threshold was only lowered by law at the end of 2025, certain employees who had already entered the workforce in 2025 without being eligible for the regime at the time are now excluded simply because they are just below the previous limit of EUR 75,000. As a result, a retroactive option to apply is available for:

• Individuals employed between 1 January 2025 and 9 January 2026;
• Who did not meet the old threshold of EUR 75,000;
• But who do meet the new threshold of EUR 70,000 and all the other conditions included in the law.

The application must be made no later than 9 April 2026. The regime then applies retroactively from their date of employment, with the earliest start date being 1 January 2025.

In order to provide tax incentives for self-employed activity and to counteract the practice of individuals working through their own one-person company (see also the measures described above regarding the level of company directors’ remuneration), self-employed persons/sole proprietorships will receive a number of tax benefits in the budget agreement of 24 November 2025 (category 2).

The Miscellaneous Provisions Act of 18 December 2025 (category 1) strengthens the tax credit for the accumulation of equity. Specifically, when their “equity” increases, beneficiaries of profits or gains are entitled to a tax credit under certain conditions. The rate of this tax credit will be doubled from 10% to 20% and the ceiling will also double from EUR 3,750 to EUR 7,500. This rule takes effect from the 2026 tax year.

The personal income tax reform bill (category 2) also envisages a number of changes. For instance, the additional tax charge due to insufficient upfront payments (6.75% for the 2025 income year) will be abolished for entrepreneurs who make profits or gains. They will also be given the opportunity to make a fifth advance payment (no later than 20 February of the tax year) that qualifies for a tax reduction of 1.5%.

In addition, self-employed persons will be entitled to an “entrepreneur deduction”. There will be a tax exemption for the first bracket (10%) of profits and gains for the self-employed in principal and secondary occupations from the 2028 tax year onwards. The deduction will be a maximum of EUR 650 (after indexation). From the 2029 income year, the deduction will increase to a maximum of EUR 900 (after indexation).

Occasional profits or gains are income obtained outside the context of a business activity (e.g. income from selling second-hand items). An occasional activity is an activity that is carried on irregularly and over a short period without repetition (regularity). This does not include a set of transactions that either occur regularly or are linked and constitute a professional activity. Income from occasional activities is taxed at 33% unless it relates to the normal activities associated with managing private assets.

In the draft personal income tax reform bill (category 2), to avoid arguments over what should or should not be considered "normal management", a de minimis rule will be introduced:

• The income from management of private assets consisting of real estate property, portfolio securities and movable objects will, from now on, be non-rebuttably deemed to be normal management of private assets, if the gross revenue does not exceed EUR 2,000 (after indexation) per taxpayer and per tax year.
  
  
• It is up to the tax administration to prove the taxable nature of the income (i.e.: that it is not normal management of private assets) in order to tax the income in excess of EUR 2,000.
  
  
• The non-rebuttable assumption does not apply to management transactions involving financial assets (cf. capital gains tax).

This rule is to become applicable from the 2027 tax year.

The coalition agreement also includes measures to encourage student work. The number of hours a student is allowed to work per year without an obligation to pay social security contributions or advance corporation tax increases from 475 to 650 hours (permanent rule) and the minimum age for entering into a contract will be lowered to 15 years. This takes effect from 1 January 2025 (category 1).

To prevent this from resulting in students no longer being dependent persons for tax purposes, the tax threshold for permitted income from student work will be increased. Children are dependent on their parents for tax purposes as long as they live at home and have only limited income. Certain types of income are fully or partly excluded from the calculation of the permitted net means of subsistence. For example, income from student work is excluded up to an amount of EUR 3,420 (for the 2026 tax year). This is now doubled to EUR 6,840 (2026 tax year) by the law of 10 April 2025 (category 1). This takes effect from 1 January 2025.

The above rules have now been approved by the Parliamentary Committee on Social Affairs.

Finally, for all dependents, the maximum permitted amount of net means of subsistence has been uniformly set at EUR 12,000 (2026 tax year) by the Law of 18 December 2025 on Miscellaneous Provisions (category 1). This takes effect from 1 January 2025 (2026 tax year).

• Employer’s costs 

There will be a framework intended to limit arguments over these tax-free allowances. Hopefully this will also include harmonisation of the rules on income tax and social security (category 2).

• Collective bonus systems (CLA 90, profit-related bonuses, etc.)          

These systems will be harmonised. In addition, flexible remuneration is allowed to be up to 20% of the annual gross salary. (category 2).

• Donations
  

In the Law of 18 December 2025 on Miscellaneous Provisions (category 1), the tax credit on donations falls from 45% to 30%. This law took effect on 1 January 2025 (2026 tax year).

• Abolition of the federal interest deduction for property

   

The Law of 18 December 2025 on Miscellaneous Provisions (category 1) provides for the abolition of the federal real estate interest deduction with effect from 1 January 2025 (2026 tax year). This removes the possibility of deducting the interest on loans taken out to acquire or maintain property (other than one's own home) from property income.

The tax authorities have confirmed that the abolition applies to both new and current debts.

In line with this, from the 2026 tax year, several federal transitional property tax schemes will also be permanently abolished. These include:

• the federal tax credit for low-energy homes, passive homes and zero-energy homes;
• the tax credit for interest on green loans;
• the additional interest deduction;
• building savings;
• the federal tax credit for the sole residence and own home (the so-called federal housing bonus*).

* The federal housing bonus covered mortgage loans taken out between 2005 and 2013 for an owner-occupied sole residence, provided that the "owner-occupied" condition was no longer met by 2015 at the latest. Personal income tax credits were available for both interest and capital repayments, provided the property was still considered to be "the sole residence".

Although these federal schemes expire from the 2026 tax year, the tax authorities emphasise that capital repayments on mortgage loans and related premiums for individual life insurance policies may still qualify for the federal long-term savings tax credit, as long as the applicable conditions are met.

 

• Taxable and deductible status of maintenance benefits paid

These are being gradually reduced for both the recipient and the payer. The deduction and tax rates will be:

• 70% for maintenance payments made or awarded since 1 January 2025 (insofar as the taxable period ends after 30 December 2025 - 80% if prior to this);
• 60% for maintenance payments made or awarded from 1 January 2026;
• 50% for maintenance payments made or awarded from 1 January 2027.

Please also note:

• This 50% rate will remain in place after 1 January 2027;
• The time when the payment is made will be decisive.

In addition, maintenance payments made to countries outside the European Economic Area (excluding Switzerland) will no longer be tax deductible (and the recipient will no longer be taxable).

The same reduction also appears in the draft law (category 2) on the tax treatment of maintenance payments made in the form of a lump sum.

This rule is contained in the Law of 18 December 2025 on Miscellaneous Provisions and applies to maintenance payments made or awarded from 1 January 2026.

 

• Restriction of the marriage quotient

The joint tax burden of married and legally cohabiting couples can currently be reduced by transferring part of one partner’s income to the other partner. However, the preliminary draft law on personal income tax reform (category 2) systematically phases out this rule.

The planned changes are as follows:

• Pensioners
  • For taxpayers who have reached the statutory retirement age on 1 January of the tax year, a 20-year phase-out will be introduced. A 30% transfer is still possible, but the maximum amount is reduced each year until no further transfers are possible from the 2046 tax year.
    
    
• Non‑retired people
  • The marriage quotient will remain, but the maximum amount that can be transferred will be gradually reduced to half over four assessment years (2027-2030). Afterwards, the scheme will remain at this lower level (even after the 2045 tax year).

Another change is that from the 2027 tax year, the maximum amounts for the marriage quotient will no longer be indexed.

The purpose of this reform is to prevent the rule from providing an incentive for one of the two partners not to work.

• Adjustments to the tax-free allowance

To increase take-home pay, the tax-free allowance for everyone with earned income will be gradually increased. In addition, the dependent child allowance will be reformed, with the same allowance applied for every child from now on, regardless of the number of children.

The preliminary draft on personal income tax reform (category 2) includes the following changes:

• Gradual increase in the tax-free allowance over assessment years 2027 to. 2031: the current base amount of EUR 4,785 (2026 tax year, non-indexed) increases to EUR 6,230 (2031 tax year, non-indexed).
• Possible adjustment by the king to set the tax-free allowance after indexation to:
• EUR 14,450 for the 2030 tax year (planned entry into force: 31 December 2028, applies from 2030 tax year)
• EUR 15,600 for the 2031 tax year (planned entry into force: 31 December 2029, applies from 2031 tax year)

This amount is intended to be retained thereafter and indexed annually.

The increase in the tax-free allowance only applies to earned income. This is done by proportionally reducing the tax credit for pensions and other replacement incomes to the value of the benefit resulting from the increased tax-free allowance.

Finally, the increase in the tax-free allowance in the year of marriage or legal cohabitation when the partner has limited means of subsistence will be removed. This change will take effect from the 2030 tax year.

 

• Second-pillar pensions

The coalition agreement provides for an increase in the maximum contributions, and also allows self-employed people in a secondary occupation to make contributions to a Supplementary Pension for the Self‑Employed (VAPZ).

Initially, the law of 25 April 2024 introduced an increase in the contribution rate for the maximum contribution, from 3% to 6%, coming into force on 1 January 2028. However, this increase was again withdrawn following the 2025-2029 budget talks.

The results of these budget talks have been converted into concrete legislation, specifically in the Law of 18 December 2025 on Miscellaneous Provisions (category 1), completely reforming the existing Wijninckx contribution. From the 2026 contribution year, the Wijninckx contribution rate for second‑pillar pensions (Individual Pension Commitment (IPC), group insurance pension plan, Supplementary Pension for the Self‑Employed (VAPZ), etc.) will rise from 3% to 12.5%.

 

Additional changes are also being made in the payment of second-pillar pensions:

• The insurer/pension institution must deduct a Sickness and Invalidity Insurance (ZIV) contribution of 3.55%.
• From 1 January 2026, the solidarity contribution will be simplified to a flat rate of 2%, instead of the previous progressive scale from 0% to 2%.
• From 1 July 2027, there will be an additional solidarity contribution on the total amount of second-pillar pension lump sums that exceed EUR 150,000 (indexable). All lump sums are added together for this purpose, from both employee and self-employed systems.
• The additional contribution only applies to life benefits, not to death benefits.

 

• Reform or reduction of the special social security contribution

The special social security contribution will be reduced and adjusted to be “single-proof”. For single people, it provides a net benefit of up to EUR 350 per year.

Currently this is also part of the draft law on personal income tax reform (category 2).

• Strengthening the fiscal work bonus

The fiscal work bonus is a tax credit linked to the social work bonus. It reduces the burden of tax on low-paid workers. Currently, the fiscal work bonus is 33.14% of the social work bonus and for very low paid workers there is an increased rate of 52.54%.

According to the draft law on personal income tax reform (category 2), the following changes will be made:

• A general increase from 33.14% to 35% that will take effect from the 2029 tax year;
• There will be an additional increase for those with very low pay from 52.54% to 63% from the 2027 tax year and from 63% to 72% from the 2029 tax year;
• The maximum amount of the tax credit will increase from EUR 765 (before indexation) to EUR 970.

 

• Remuneration for voluntary overtime

At present there is a temporary voluntary overtime scheme with a basic quota of 100 voluntary overtime hours, plus a further 120 economic recovery hours. The remuneration for these 120 economic recovery hours is exempt from income tax, provided the pay for these hours is in accordance with the applicable conditions within two years after the work is done.

According to the law of 31 July 2023 and an amendment (category 1), this economic recovery scheme is expressly made applicable for the period from 1 January 2026 to 31 March 2026. As a result, the remuneration related to these 120 voluntary economic recovery hours also benefits from a tax exemption during this period.

From 1 April 2026, a permanent rule will come into force via the draft law on personal income tax reform and the draft law on miscellaneous fiscal provisions (category 2) that provides for the following:

• The maximum number of voluntary overtime hours that can be worked is 360 hours per year.
• Of these 360 hours, 240 hours per year are exempt from income tax.
• The exemption applies only if no overtime bonus is paid (i.e. only the standard rate of pay is eligible).
• The exempt remuneration must be disclosed on the tax return.
• The condition that the exemption applies only to full-time employment is removed.

A separate rule will continue to apply to the hospitality sector:

• The maximum amount of voluntary overtime eligible for tax exemption is 300 hours per year, or 360 hours if the employer uses a registered cash system.
• The condition that no overtime bonus may be paid also remains applicable here.
• Under the permanent scheme (from 1 April 2026), the voluntary hours covered by the general scheme must be deducted from the maximum within the hospitality scheme.
• This amended rule for the hospitality sector also applies to overtime worked from 1 April 2026.

 

• Dependants

The Law of 18 December 2025 on Miscellaneous Provisions (Category 1) made several changes to the conditions for being considered a dependent person. These take effect from the 2025 income year (2026 tax year).

As mentioned earlier, the indexed maximum net means of subsistence for tax purposes will now be uniformly set at EUR 12,000 for all dependent children.

In addition, the following changes are made:

• People receiving an integration income no longer qualify as dependent persons.
• Persons receiving business income for which the taxpayer has business costs can no longer be classified as dependent persons. This used to apply to employees only, but is now being extended to all professional income.
• Scholarships that do not give rise to the accrual of social security rights, whether full or otherwise, are no longer considered as means of subsistence.
• On the other hand, Ph.D scholarships must now be included as means of subsistence.

 

• Flexi-jobs

 

The Law of 18 December 2025 on Miscellaneous Provisions (category 1) increases the tax exemption for non-retired workers with flexi-jobs from EUR 12,000 to EUR 18,000 from the 2025 income year (2026 tax year).

 

• Freezing the indexation of fiscal costs

Between the 2026 and 2030 tax years, indexation of a series of fiscal costs is temporarily suspended by the law of 18 December 2025 on Miscellaneous Provisions (category 1). During this period, the amounts concerned will therefore be kept at the same level as the 2025 tax year and will not be adjusted for inflation.

Specifically, this involves freezing the indexation of:

• The exempt first bracket of income from:
  • Savings deposits: maximum EUR 1,020;
  • Dividends: maximum EUR 833;
  • Interest from recognised social enterprises: maximum EUR 200;
  • Loans via a crowdfunding platform whose interest is exempt: maximum EUR 16,270;
• Tax basket for long-term savings tax relief: the maximum amount of eligible deposits remains EUR 2,450;
• Tax credit for acquisition of employer shares;
• Tax credit for donations: the maximum deductible amount remains capped at EUR 408,130.

From the 2031 tax year, these amounts will be re-indexed and there will be no retroactive indexation for the years 2026-2030.

Please note there are some exceptions to this freeze:

• Pension savings: pension savings amounts will still be indexed for 2026 tax year; the freeze will only take effect from the 2027 tax year.
• Employer's contribution for commuting (non-public transport): for the 2026 tax year only this indexation is not applied. The maximum amount therefore remains – as in the 2025 tax year – EUR 490. This one-off non-indexation will also not be made up later.
• Tax credit for dependent children: the maximum amount is permanently frozen at the level of the 2025 tax year, i.e. EUR 550.

 

• Fewer tax credits

From the 2026 tax year, several tax credits and personal income tax deductions will disappear. The measures included in the Law of 18 December 2025 on Miscellaneous Provisions (category 1) include the abolition of:

• PC private plan;
• The additional flat rate for distant travel (employees commuting over a daily distance of more than 75 kilometres were previously entitled to this);
• The exemption for internships within the company;
• The exemption for additional personnel for the export and total quality assurance departments (the existing exemption will be retained insofar as recruitment occurred no later than 31 August 2025);
• The exemption for additional low-paid staff in an SME;
• Tax credit for a private private-equity investment scheme (privak);
• Tax credit for acquisition of an electric vehicle;
• Tax credit for development fund expenditure;
• Tax credit for employing a domestic worker;
• Tax credit for adoption;
• The tax credit for legal assistance insurance will be removed from the 2026 tax year. This also removes the obligation for legal assistance insurers to inform the tax authorities every year about the insurance policies they have concluded, starting on 1 January 2026;
• Tax credit for a charging point.