Key takeaways
- The standard corporate income tax (CIT) rate is 25% on the entire taxable profit.
- Small companies benefit from a reduced rate of 20% on the first €100,000 of profit.
- Since tax year 2026, the minimum remuneration of a director must reach €50,000 gross to qualify for the reduced rate.
- Quarterly advance payments are compulsory: insufficient payments incur a 6.75% surcharge.
- The taxable base starts from the accounting result, adjusted by non-deductible expenses and tax deductions.
Corporate income tax (CIT) applies to the profits of Belgian resident companies: SRLs, SAs, SCs and most other legal forms with legal personality. Since tax year 2021 (2020 income), the standard rate has been 25%, and a reduced rate of 20% applies to the first €100,000 for small companies that satisfy certain conditions. This guide reviews the rates, the criteria for accessing the reduced rate, the construction of the taxable base and the quarterly advance payment mechanism.
Corporate income tax rates in Belgium
CIT has two rates, applicable depending on the size of the company and compliance with precise conditions.
standard rate
on the entire taxable profit
SME reduced rate
on the first €100,000 of profit
reduced tranche threshold
above this: 25% on the surplus
The reduced rate does not apply automatically to all small companies. The company must satisfy a set of cumulative legal conditions, defined in Articles 215 et seq. of the Income Tax Code 1992 (ITC 92). When even one condition is not met, the 25% rate applies to the entire profit.
20% reduced rate: who can benefit
The first condition is to be a small company within the meaning of Article 1:24 of the Companies and Associations Code (CAC). A company is small if it does not exceed more than one of the following three criteria, assessed over two consecutive years:
Small company criteria (Art. 1:24 CAC)
Annual turnover excluding VAT below €11.25 million
Balance sheet total below €6 million
Average number of employees below 50 full-time equivalents
The vast majority of newly created SRLs and SAs immediately satisfy these criteria. Being a small company is necessary but not sufficient: other conditions are added.
The main exclusions from the reduced rate target investment, treasury and financial companies, as well as companies whose shares are held in majority by another company rather than by natural persons. These exclusions are verified year by year.
The director remuneration condition
The most commonly unmet condition is that of the minimum director remuneration. The company must allocate to at least one of its directors a gross annual remuneration of at least €50,000 (since tax year 2026, up from €45,000 previously).
This minimum remuneration is assessed individually: the sum of the remunerations of several directors cannot substitute for the condition of a single director reaching the threshold.
Since tax year 2026, a complementary rule applies: flat-rate benefits in kind (company car, accommodation made available, options on shares assessed at a flat rate) may not exceed 20% of the overall remuneration package of the director concerned.
If the director's remuneration remains below the threshold while the company's profit exceeds it, the company loses the reduced rate on its entire profit and is also subject to a separate non-deductible contribution on the remuneration shortfall. The financial impact is therefore twofold.
Building the taxable base: from accounting result to taxable profit
CIT does not apply to the gross accounting result as shown in the annual accounts. The taxable base is obtained after a series of tax adjustments.
| Description | |
|---|---|
| Starting point | Accounting result before taxes |
| + Non-deductible expenses (NDE) | Booked charges that are not fiscally deductible (fines, 50% of reception expenses, private expenses...) |
| + Abnormal or voluntary advantages | Advantages granted without consideration to related third parties |
| - Definitively taxed income (DTI) | 95% of dividends received from qualifying subsidiaries |
| - Investment deduction (ID) | On certain professional assets acquired during the year |
| - Prior tax losses | Losses from previous years carried forward |
| = Taxable profit | Base on which CIT is calculated at the applicable rate |
Non-deductible expenses (NDE) are the most frequent adjustment in practice. They include all charges that reduced the accounting result but which tax law refuses to consider deductible: tax fines and penalties, a fraction of restaurant expenses, expenses unrelated to professional activity, or interest on certain loans between related companies at abnormal rates.
The definitively taxed income (DTI) deduction avoids economic double taxation on dividends distributed by a subsidiary: if the subsidiary has already paid CIT on its profit, the parent company can deduct 95% of the dividends received from its own taxable base.
Quarterly advance payments: avoiding the 6.75% surcharge
Every Belgian company is in principle required to pay quarterly advance payments on the CIT it expects to owe. Absence or insufficiency of advance payments incurs a 6.75% surcharge calculated on the CIT amount due for the year. This surcharge is itself a non-deductible expense, which amplifies its real impact.
For tax year 2027 (income of year 2026), the four deadlines are:
- 1
First advance payment
10 April 2026Bonus of 9% of the amount paid, which reduces the potential surcharge.
- 2
Second advance payment
10 July 2026Bonus of 7.50% of the amount paid.
- 3
Third advance payment
12 October 2026Bonus of 6% of the amount paid.
- 4
Fourth advance payment
21 December 2026Bonus of 4.50% of the amount paid. Last advance payment of the year.
The system works through offsetting: the bonuses generated by the payments cancel the theoretical 6.75% surcharge. A company that pays advance payments sufficiently early and in adequate amounts incurs no surcharge.
Newly created companies are exempt from the surcharge during their first three accounting years: they can wait for the tax settlement without incurring any penalty, which provides welcome flexibility during the start-up phase.
Advance payments are made via MyMinfin or by bank transfer to the FPS Finance collection account, with a structured reference. Updated information on amounts and deadlines is available at finances.belgium.be.
Practical calculation: standard rate versus reduced rate
Consider an SRL whose taxable profit for the year amounts to €120,000. It meets all the conditions for the reduced rate. Here is the difference:
| Standard rate (25%) | SME reduced rate | |
|---|---|---|
| Tranche €0 to €100,000 | €25,000 | €20,000 |
| Tranche €100,001 to €120,000 | €5,000 | €5,000 |
| Total CIT | €30,000 | €25,000 |
| Saving achieved | €5,000 |
The maximum saving is €5,000 per year (5% on €100,000). It remains constant regardless of profit above €100,000, since the upper tranche is always taxed at 25%.
To benefit from this saving, the director's gross remuneration must reach €50,000. If you are considering incorporating an SRL in Belgium, incorporating this parameter into your remuneration plan from incorporation avoids having to adjust the structure during the year.
Optimise the taxation of your Belgian company
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Further reading
Understanding CIT is inseparable from the other tax obligations of a Belgian company:
- VAT for the self-employed in Belgium: thresholds, exemption and obligations: the VAT regime you have chosen influences accounting and deductible expenses.
- Incorporating an SRL in Belgium: steps, costs and timelines: choosing the right legal structure is the first decision that determines your tax burden.
- SRL financial plan: what it is for and how to draft it: the mandatory financial plan at incorporation anticipates the first financial years and therefore the first CIT amounts.
