The Belgian New Capital Gains Tax On Financial Assets

The federal government is asking the wealthiest individuals ("with the broadest shoulders') to make an additional contribution in order to reduce the budget deficit. This will be done in particular through a capital gains tax on financial assets.

The text underwent numerous adaptations, amendments and renegotiations throughout 2025. Due to the postponement of budget negotiations, the bill has not yet been submitted to Parliament. The government has just approved the definitive text.

The law will not be adopted in 2025, and the tax will only be introduced after 1 January 2026, but with retroactive effect from 1 January 2026.

What are the main features of the tax ?

1. Who is targeted ?

The new tax will apply exclusively to individuals who are resident in Belgium, investors and entrepreneurs who hold shares in a company.

It will also apply to legal entities (Belgian and international associations, private foundations, etc.) that are not liable to the corporate income tax. Legal entities that are eligible for tax relief on donations are excluded, as are certification vehicles (stichting administratiekantoor).

Companies are not targeted, they pay corporate income tax on their capital gains, except for exemptions under the Belgian holding company regime.

2. What are financial assets ?

The term 'financial assets' is interpreted broadly and includes four categories :

• Financial instruments : in particular listed and unlisted shares of companies, bonds, shares of investment funds (including trackers) and derivatives (options, futures, swaps, forward contracts, etc.), credit default swaps, contracts for differences, and emission rights, etc.
• Savings insurance policies (branches 21, 22 or 26) and investment insurance policies (class 23) or a combination of both (class 44), as well as similar overseas life insurance contracts (such as Luxembourg's class 6). The following are not affected : death benefits, changes of investment fund in class 23 or changes in class 44 insurance.
• Crypto-assets.
• Currencies and gold coins.

3. Exemptions

The following are not financial assets : real estate, artworks, jewellery, bottles of wine or whisky, vintage cars, etc.

The following are specifically excluded :

• Capital gains on financial assets in the second pension pillar (occupational pensions as part of a career as an employee or self-employed).
• Capital gains on financial assets in the third pension pillar (individual pension savings funds or insurance).
• Death benefits paid by an insurance company upon death are excluded, but inheritance tax will generally be payable.
• The change of investment funds in a branch 23 insurance policy or the modification in a branch 44 insurance policy.

4. How is capital gains calculated ?

Capital gains realised from 1 January 2026 onwards will be subject to tax ; historical capital gains prior to 1 January are exempt.

• If you acquired the financial assets at a value higher than the value on 1 January 2026, you may be able to use this higher purchase value if you can provide proof, but only until the end of 2030.
• Brokerage fees and taxes (e.g. the stock exchange tax) are not deductible.
• For staggered purchases of the same financial asset after 1 January 2026, the purchase value will be calculated using the FIFO method. This means that, in the event of a sale, the shares purchased first are sold first. If you buy 15 shares at €100, then another 25 at €150. If you sell 10 shares at €200 each, the capital gain is (10 x 200 - 10 x 100 =) €1,000.

For financial asset in another currency, the purchase price and the resale price are converted into euros based on the exchange rates at the time of the purchase and the resale, respectively.

5. Valuation of financial assets as at 31 December 2025

It will be important to keep the proof of the purchase price, especially for financial assets acquired after 31 December 2025. In the absence of supporting evidence, the acquisition value of the financial asset could be deemed to be zero and the taxable capital gain would correspond to the full price received on resale.

For financial assets listed on a stock exchange, it will be the last closing price of 2025.

For life insurance policies, it will be the inventory at 31 December 2025, or the sum of the premiums paid by the policyholder if this amount is higher.

For shares in unlisted companies, the valuation can be based on

• The price agreed upon during a sale of financial assets between independent parties in 2025.
• The value agreed at the time of the incorporation of a company or a capital increase in 2025.
• The value used in a contract or contractual offer for a put option on these financial assets, effective on 1 January 2026.

The legislator has provided for a default valuation method, namely the value of equity plus four times the operating profit before depreciation and amortisation for the last financial year ended before 2026

Equity + (4 x EBITDA of the last financial year ended before 1 January 2026)

This formula has been criticised because the multiplier of the EBITDA is too low for most economic activities.

Finally, an (independent) company auditor or certified public accountant may be called upon to establish the value of the financial assets. This valuation should be carried out no later than 31 December 2027.

6. Are capital losses deductible ?

Capital losses can be offset against capital gains, but only from capital gains that you have realised during the same year on financial assets in the same category.

Capital losses before 31 December 2025 cannot be set off against capital gains.

Furthermore, capital losses can only be deducted from capital gains on financial assets that are subject to the same tax regime (see 7.1, 7.2 and 7.3), i.e. taxed at the same rate. Capital losses on an investment portfolio (10%) cannot be offset against internal capital gains (33%).

Capital losses are deducted via the tax return. Investors must therefore declare the capital gains.

Exc : https://multimedia.lecho.be/taxe-plus-values-explicatif/#quid-en-cas-de-moins-value-historique

7. What are the tax rates ?

7.1. Basic rate

The capital gains tax is levied at 10%, but each year, capital gains are exempt up to €10,000. If the taxpayer does not use the annual exemption, it increases by €1,000 per year up to a maximum of €15,000 after five years.

7.2. Substantial shareholdings

IThere will be a special regime for taxpayers who personally hold a shareholding of 20% or more.

The first million euros is exempted (this exemption can only be used once every five years), the rates are as follows.

• Between 0 and 1 million €.................... 0%
• Between 1 and 2.5 million €.................... 1.25%
• Between 2.5 and 5 million €.................... 2.50%
• Between 5 and 10 million €.................... 5%
• Over 10 million €.................... 10%

If the purchaser is an entity that not established outside the European Economic Area, the fixed rate of 16.5% is maintained for the portion of the capital gain that exceeds the first exempt tranche of €1 million.

7.3. Internal capital gains

Capital gains realised on the sale of shares by a taxpayer to a company that he controls, either directly or indirectly through family members, are taxed at 33%.

7.4. Gains made outside the normal management of a private estate

Capital gains made on any type of assets outside the normal management of a private estate are taxed at 33% as well.

8. Investment funds

Sales by an investment fund of its assets do not generate taxable capital gains for the fund holders : capital gains are only taxed when the money is withdrawn from the fund. This means that capital losses made in the fund are set off against the capital gains made in the fund.

A capitalisation fund that invests at least 10% in bonds is already subject to a 30% tax on the bond portion of any capital gains, known as the 'Reynders tax', named after the then Minister of Finance. If the fund is invested for 60% in bonds, the bond portion of the capital gain (60%) will be taxed at 30% tax, while the rest will be taxed at 10%.

9. What happens in the event of death ?

The beneficiary of an inter vivos gift, an inheritance or a bequest of a financial asset does not realise a capital gain.

However, any capital gains realised on the subsequent resale of the financial asset received will be liable to the capital gains tax. This will be calculated on the basis of the initial acquisition value paid by the donor or the deceased.

Capital gains tax may, therefore, be due on top of the gift tax or the inheritance tax.

Capital gains realised when a form of joint ownership is terminated within three years from a death, a divorce, the end of a registered or non-registered partnership are also exempt.

10. How is the capital gains tax levied ?

In principle, Belgian financial institutions (banks, brokers, insurance companies, etc.) must withhold the capital gains tax. However, most foreign financial institutions will not withhold the tax. Their Belgian clients will have to declare the capital gains themselves.

One can opt-out of the withholding of the capital gains tax to report the capital gain in one's income tax return ; the Belgian financial institutions will then provide all the information on the capital gains to the tax authorities.

If the bank withholds the tax, you can claim a refund of the tax in your personal income tax return. This will be the case for the exemption of the first €10,000, the deduction of an acquisition value higher than the value on 31 December 2025 or the deduction of capital losses.

In the absence of the law at the beginning of 2026, financial institutions will not be able to withhold the tax. They will have until 30 June 2026 to prepare and they will then have to collect the tax retroactively on capital gains realised previously, except in the case of an opt-out. If the taxpayer explicitly asks their bank to collect the tax retroactively, the bank may collect "an amount equivalent to the withholding tax".

Taxpayers will have to report other capital gains (on substantial shareholdings and internal capital gains) in their income tax return. The parties who intervened in the transaction will have to report it to the tax administration.

11. Practical points of interest

11.1. Exit tax
To prevent taxpayers circumventing the capital gains tax by moving abroad, there will be an exit tax on latent capital gains.

However, if the taxpayer emigrates to a Member State of the European Economic Area or to a country with which Belgium has concluded a double tax agreement providing for the exchange of information and mutual assistance in recovery, he will have an automatic deferral of payment for a period of two years. If he does not sell during these two years, no capital gains tax will be due. If he does, Belgian capital gains tax will be due and the Belgian tax authorities could envisage recovering the tax with the help of the tax authorities of his country of residence.

In the event of departure to another country, the deferral must be authorised with a guarantee for the payment of the tax.

11.2. Step up in case of immigration
Non-residents who come to Belgium will be entitled to a step-up when they move to Belgium so that they are not taxed on the basis of the actual acquisition value but on the value on the day they become Belgian residents.

11.3. Stock options and capital gains
The stock option programme is a very favourable remuneration tool in Belgium. Belgium has put in place a favourable regime that allows taxation at the time the options to purchase shares in the employer company are granted. Under certain conditions, the options are valued at 9% of the value of the underlying shares. Social security contributions are generally not payable and the benefit is taxed as professional income at the normal progressive rate (25% to 50%) plus municipal tax.

At present, taxation ends there. The vesting of options (i.e. when the conditions are met), the exercise of options to purchase shares or the sale of options or underlying shares has no tax implications for the employee. The sale of shares is currently exempt from tax in Belgium.

With the introduction of the new capital gains tax, capital gains on options or on shares will be taxed at a rate of 10% with an annual exemption of €10,000.

11.4. Bequests and gifts

Capital gains tax is not payable in the case of bequests or donations.

In the case of gifts to a Belgian resident beneficiary, the capital gains tax is deferred until the beneficiary realises the capital gain. When the beneficiary sells the financial assets he has received, he must pay the capital gains tax calculated on the basis of the value for which the donor has acquired them.

If that was before 2026, any capital gains will be calculated on the basis of the value of the asset on 31 December 2025. If they were acquired after 1 January 2026 onwards, it is recommended that the gift deed identifies the price and date of acquisition by the donor and that proof of this be attached to the deed.

A gift to a non-resident is not targeted by the exit tax as was initially planned, but the tax authorities could tax such a gift with the general anti-abuse provision, e.g. if the non-resident beneficiary realises the capital gain on the financial assets he receives and then returns the proceeds to the donor.

11.5. Gifts of bare ownership of financial assets

If a person holds a right of usufruct on financial assets, the capital gains tax is due by the bare owner.

This could be a problem if the usufruct agreement grants the proceeds and capital gains to the usufructuary. The bare owner would have to pay tax on any capital gains realised by the usufructuary.

When a Belgian resident gifts the bare ownership of financial assets to a non-resident, the capital gains on these financial assets will no longer be taxable in Belgium but possibly in the country where the bare owner is a resident depending on the local tax legislation.

11.6. Life insurance policies

With a life insurance policy of branch 23, it is the insurance company that owns the investments, any sales by the insurance company does not realise capital gains, and hte insurance company can set off the capital losses.

It is only when funds are withdrawn from the policy that a capital gain may be made. tax contract. Consequently, capital losses accumulated throughout the term of the contract are offset against gains in the policy.

Capital gains on a life insurance policy (which is not excluded, see 3) are taxable when these gains are realised upon withdrawal of the accumulated capital, plus any gains made during the term of the policy. The capital gains tax is due by the policyholder.

However, when the policyholder dies, and the death benefits are paid to the beneficiary of the life insurance policy (upon expiry of the contract, the death of the insured person), no capital gains tax is due. Planning with a gift of the policy to one's heirs could get around the capital gains tax.

11.7. Crypto-assets

While it is relatively easy to determine the value of a bitcoin portfolio, it can be less straightforward for other lesser-known crypto assets, such as tokens (digital versions of underlying assets). Investors must therefore identify platforms that provide prices for all their crypto assets, which will enable them to document their value.

Investors in crypto assets held via a Belgian financial institution can have the bank deduct the 10% withholding tax. Investors who hold their crypto assets with an overseas platform will have to report their capital gains in their income tax return, with the platform informing the Belgian tax administration of the value of their portfolios and the gains made via the Common Reporting Standard (DAC 7).

This is likely to trigger questions from the tax administration about the nature of the gains (outside the normal management of a private estate (33%), earnings (25-50%).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.