Key takeaways
- In an SRL, the management body is composed of one or more administrators, appointed by the general meeting or in the articles (art. 5:70 CAC). They replace the 'gérants' of the former SPRL.
- The administrator holds internal management power and external representation power; restrictions on the representation power are unenforceable against third parties, even if published (art. 5:73 §2 CAC).
- Remuneration is the legal default (art. 5:72 CAC): a gratuitous mandate must be expressly decided. When received, remuneration is deductible for the SRL and taxed under personal income tax for the administrator.
- An administrator not named in the articles is removable ad nutum at any time; a statutory administrator can only be removed by amending the articles or for just cause.
- The administrator's liability is capped by the CAC (art. 2:57), except in cases of fraud, habitual gross negligence, or breaches of tax or social security obligations.
Once an SRL designates an administrator, it entrusts that person with its full operational decision-making power. The administrator mandate in a Belgian SRL is the legal framework that defines what that person may do on behalf of the company, what they receive in return, and what they risk if they fail in their obligations. The Companies and Associations Code (CAC), which came into force for SRLs on 1 May 2019 for newly incorporated companies and on 1 January 2020 for existing ones, thoroughly reformed these rules.
Composition and appointment of the management body
Art. 5:70 §1 of the CAC provides that an SRL may be managed by one or more administrators, natural or legal persons. Unlike a public limited company (SA), no minimum number is imposed: a single-member SRL can perfectly well function with a sole administrator, including the founder-shareholder themselves.
When a legal person is appointed as administrator, it designates a permanent representative, a natural person, who exercises the mandate on its behalf. That representative incurs personal liability as if exercising the mandate directly, alongside the liability of the legal person itself.
The appointment of administrators takes place:
- in the deed of incorporation, for the first administrator(s); or
- by decision of the general meeting of shareholders, during the company's lifetime.
Art. 5:70 §2 of the CAC provides that the mandate may be for a fixed term (ending automatically) or indefinite (removable at any time). No maximum duration is imposed by law. Any appointment must be published in the annexes to the Moniteur belge (Belgian Official Gazette) to be enforceable against third parties.
Powers of the SRL administrator
The law grants the management body two distinct types of powers.
Residual management power (art. 5:73 §1 CAC) covers all matters not expressly reserved to the general meeting by law or the articles. In practice, this includes all day-to-day decisions: entering into contracts, hiring staff, incurring expenditure, managing treasury, or taking commercial decisions.
Representation power (art. 5:73 §2 CAC) authorises the administrator to bind the SRL vis-à-vis third parties: signing contracts, litigating, executing notarial deeds. The CAC provides that restrictions on this power in the articles or in the appointment decision are unenforceable against third parties, even if they have been published in the Moniteur belge (art. 5:73 §2 al. 2 CAC). In other words, even if the articles require two joint signatures above a certain amount, a contract signed by a single administrator binds the SRL against any third party, whether or not that third party was aware of the restriction.
| Management body powers | Powers reserved to the general meeting | |
|---|---|---|
| Day-to-day decisions | Contracts, hiring, purchases, banking | No (unless a statutory threshold applies) |
| Appointment of administrators | ||
| Removal of administrators | ||
| Approval of annual accounts and discharge | Mandatory (art. 5:98 CAC) | |
| Amendment of the articles | 3/4 of votes + 50% quorum (art. 5:100 CAC) | |
| Distribution of dividends | After double distribution test | |
| Delegation of daily management | Possible (art. 5:79 CAC) |
The management body may delegate daily management to one or more persons (art. 5:79 CAC), who may act alone, jointly, or collegially. This delegation covers acts and decisions that do not exceed the ordinary needs of the company. The delegate(s) for daily management act under the oversight of the management body, which remains responsible for the framework within which the delegation is exercised.
Remuneration of the SRL administrator
Art. 5:72 of the CAC sets the remuneration regime: unless the articles provide otherwise or the general meeting decides otherwise at the time of appointment, administrators are remunerated for the exercise of their mandate — remuneration is the default, and a gratuitous mandate must be expressly decided. Where the amount was not fixed at the time of appointment, the general meeting determines it.
CAC
Administrator remuneration: default entitlement, unless a gratuitous mandate is expressly decided
ITC 92
Defines director's income: remuneration, profit-linked fees, benefits in kind
ITC 92
Obligation to withhold professional withholding tax on each remuneration payment
Remuneration may take several forms:
- Fixed cash remuneration: subject to professional withholding tax (art. 270 ITC 92), which the SRL deducts and pays to the FPS Finance before each transfer.
- Profit-linked fees (tantièmes): profit allocations decided by the general meeting, treated as non-periodic income.
- Benefits in kind: company car, accommodation provided by the company, meal vouchers above the exempt ceiling. These are added to the gross remuneration for the withholding tax calculation (boxes 9b and 9c of the 281.20 withholding certificate).
- Unpaid mandate: legal and common in single-member SRLs where the sole shareholder is also administrator and remunerates themselves solely through dividends.
One fiscal consideration not to overlook: to benefit from the reduced 20% corporate tax rate on the first bracket of taxable profit, the SRL must notably pay at least one administrator a remuneration reaching the minimum threshold set by art. 215, §3, 4°, of the Income Tax Code 1992 (ITC 92). This threshold is indexed annually; verifying it is a task for an accountant or tax adviser.
Any administrator receiving remuneration is treated as a self-employed worker for social security purposes and must affiliate with a social insurance fund to pay INASTI contributions within 90 days of starting the activity.
Support for your SRL governance
Monsiegesocial supports SRL administrators in Belgium on company domiciliation, incorporation and management obligations.
Liability of the SRL administrator
The CAC distinguishes two liability regimes for SRL administrators.
Mismanagement (art. 2:56 CAC) is measured against the standard of a normally prudent and diligent administrator placed in the same circumstances. Each administrator answers only for their own fault: liability is not automatically joint and several between co-administrators for ordinary management decisions. In a collegial body, an administrator may be exonerated if they did not participate in the faulty decision and reported it within a reasonable timeframe to all other members.
Violations of the CAC or the articles trigger joint and several liability for all participating administrators (art. 2:56 CAC). Each co-administrator can be exonerated by proving they took no part in the decision and reported the fault in good time.
The CAC introduced a liability cap (art. 2:57) proportional to company size (calculated on turnover and balance sheet). The cap applies per mandate and per damaging event. It does not apply in cases of fraud, habitual gross negligence, or failure to comply with specific tax or social security obligations.
Protections available to the SRL administrator
Annual discharge by the general meeting
Voted when the annual accounts are approved (art. 5:98 CAC), it releases the administrator from liability for acts known to the shareholders and approved in the accounts. It does not cover concealed acts or criminal offences.
Contractual limitation in the articles
The articles may provide for collective decision-making rules, conflict-of-interest procedures (art. 5:76-5:77 CAC) and other mechanisms that limit individual exposure.
Directors and Officers (D&O) liability insurance
A D&O policy covers some of the risks of personal liability claims: defence costs, damages within certain limits. Not mandatory but recommended for companies of significant size.
Legal liability cap (art. 2:57 CAC)
A statutory financial ceiling proportional to company size, applicable per mandate and per damaging event, except for fraud or habitual gross negligence.
The limitation period for a liability action against an administrator is 5 years from the damaging act (art. 2:143 §1 CAC), or from its discovery for concealed acts. The company may act through a company action decided by the general meeting (art. 5:103 CAC); shareholders representing at least 10% of the shares issued may bring an action on behalf of the company if the general meeting refuses to do so (art. 5:104 CAC).
End of mandate: removal, resignation and discharge
An administrator's mandate ends in several ways, depending on how they were appointed.
An administrator not named in the articles (appointed by general meeting resolution) may be removed at any time, without cause or compensation, by simple majority of the general meeting (ad nutum removal, art. 5:70 §3 CAC). The removal takes effect immediately. The meeting may nonetheless grant notice or a severance payment in the removal resolution, but this is not a statutory requirement.
An administrator named in the articles can only be removed by amending the articles, which requires a 50% attendance quorum and a three-quarters majority of votes cast (art. 5:100 CAC). Exception: for serious just cause, a simple majority suffices even against a statutory administrator.
Resignation is open at any time. An administrator who resigns at an inopportune moment for the company (for example during a crisis or without leaving time to organise a replacement) may incur liability for the resulting damage (art. 5:70 §4 CAC). Resignation must be notified in writing to the company and published in the Moniteur belge to be enforceable against third parties.
In all cases, a change of administrator must be published in the Moniteur belge within the legal timeframe. Until publication has occurred, the former administrator may still bind the company against third parties who were unaware of the removal or resignation.
Going further
- Professional withholding tax on SRL director remuneration: calculation, tax bands and filing obligations for withholding tax on the administrator's remuneration
- General meeting of an SRL in Belgium: the sovereign body that appoints, removes and discharges administrators
- Annual management report of an SRL: the narrative document that the management body prepares for large SRLs
- FPS Finance, company director income: official tax framework for the remuneration and benefits received by the administrator
