Key takeaways
- The RDT deduction lets a Belgian company deduct 100% of dividends received from a subsidiary, to avoid economic double taxation.
- Three cumulative conditions apply: taxation, participation (10% or 2,500,000 euros) and permanence (one-year holding period).
- Since the loi-programme of 18 July 2025, a financial fixed asset condition restricts access to the regime for large companies holding a participation under 10%.
- Excess RDT exceeding the taxable profit is carried forward without any time limit (art. 205, §3, CIR 92).
A Belgian company receiving a dividend from its subsidiary faces a precise tax risk: seeing that same profit taxed a second time, after it was already taxed in the subsidiary's accounts. The RDT deduction (dividends-received deduction) neutralises that risk by allowing 100% of the dividend to be deducted from the corporate income tax base, subject to three legal conditions. This guide details those conditions, the calculation mechanism and the recent tightening of the regime for large companies.
The principle of the RDT deduction: avoiding economic double taxation
The definitively taxed income (RDT) regime answers a simple logic: a profit already subject to corporate income tax in the subsidiary that distributes it should not be taxed a second time when it flows up to the parent company as a dividend. Without this mechanism, a group of companies would see its economic profit erode at every level of distribution.
The parent company deducts the gross dividend received from its taxable base off the accounts, provided three cumulative conditions are met: the taxation condition, the participation condition and the permanence condition.
The three cumulative conditions of the RDT deduction
The three conditions are assessed together: it only takes one to be missing for the dividend to remain fully taxable under corporate income tax.
Conditions to qualify for the RDT deduction
Taxation condition (art. 203, §1, CIR 92)
The distributing subsidiary cannot fall under a tax regime notably more advantageous than the ordinary Belgian regime, nor be established in a country with no tax or no tax regime on profits.
Participation condition (art. 202, §2, CIR 92)
The parent company must hold at least 10% of the subsidiary's capital, or, failing that, a participation whose acquisition value reaches at least 2,500,000 euros.
Permanence condition (art. 202, §2, CIR 92)
The shares must be held in full ownership for an uninterrupted period of at least one year.
The participation condition is the one that comes up most often in holding structures: a company holding a line of listed shares without reaching 10% of the capital can still claim the RDT deduction, provided the price paid for that line exceeds the 2,500,000 euro threshold.
deduction rate
on the gross dividend meeting the three conditions
participation threshold
or 2,500,000 € acquisition value (art. 202, §2, CIR 92)
holding period
permanence condition, in full ownership and uninterrupted
The permanence condition does not prevent deducting the dividend at the time it is received, even if the one-year holding period has not yet elapsed: the deduction is provisionally granted, provided the company actually meets the one-year period afterwards. If the participation is sold before that term, the deduction initially granted is called back into question.
The financial fixed asset condition: applicable from assessment year 2026
The loi-programme of 18 July 2025 (Belgian Official Gazette of 29 July 2025) added a fourth requirement, applicable from assessment year 2026, for companies that are not small companies within the meaning of article 1:24 of the Code of Companies and Associations (CSA). When such a company holds a participation below the 10% threshold but whose acquisition value exceeds 2,500,000 euros, it must now record that participation as financial fixed assets to keep benefiting from the RDT deduction on the related dividends.
The tax administration clarified the application of this condition in circular 2025/C/63 of 3 October 2025. The practical scope goes beyond large listed holding companies: a non-small company investing more than 2,500,000 euros in an unlisted start-up without holding 10% of its capital is also affected, unless a specific exclusion applies to its situation.
Calculating the RDT deduction: a simplified example
Take a Belgian company that has held 15% of a subsidiary's capital for three years and receives a gross dividend of 200,000 euros during the financial year. All three conditions are met: participation above 10%, holding period above one year, subsidiary subject to the ordinary tax regime.
| Without RDT deduction | With RDT deduction | |
|---|---|---|
| Gross dividend received | 200,000 € | 200,000 € |
| Amount deducted from the taxable base | 0 € | 200,000 € |
| Additional taxable base from the dividend | 200,000 € | 0 € |
| Corporate tax due on this dividend (normal rate 25%) | 50,000 € | 0 € |
This calculation isolates the effect of the dividend on the taxable base: it does not account for the withholding tax already levied by the subsidiary at distribution, nor for the other adjustments that make up the financial year's taxable result.
When the total amount of definitively taxed income exceeds the taxable profit available for the financial year, for example in the case of a loss-making year, the excess is not lost: it is carried forward to subsequent years, without any time limit, in accordance with article 205, §3, of the CIR 92. This unlimited carryforward sets the RDT deduction apart from several other tax deductions that are capped in time or in amount.
Structuring your company or holding in Belgium
Monsiegesocial supports the creation and registered-office services of Belgian companies, including participation-holding structures.
Going further
The RDT deduction fits into the broader construction of a Belgian company's taxable base:
- Corporate tax in Belgium: rate, calculation and reduced SME rate: the RDT deduction is one of the adjustments that lead from the accounting result to the taxable profit.
- Holding company in Belgium: setting up a holding, tax advantages and structure: the RDT deduction is one of the tax levers that frequently justify setting up a holding structure.
- Withholding tax on SRL dividends: rates and optimisation: the tax treatment of the same dividend, from the perspective of the company distributing it.
