Author: ibizz

In our newsletter of 19 January 2026, we already informed you about the planned “centimes index.” The measure has since been approved by Parliament and has been in force since 1 June 2026.

Below you will find an overview of how this new measure will be applied in practice.

What is the centimes index?

The centimes index consists of two main components:

1. As of 1 June 2026, the government limits automatic salary indexation twice for higher salaries.
2. A new special employer contribution aimed at wage moderation is introduced, whereby employers must transfer half of the savings resulting from this limitation of indexation to the government.

Limitation of salary indexation: how does it work?

In Belgium, salary indexation in the private sector is regulated at sector level. Each sector determines how indexation is calculated and when it is applied.

The centimes index has a direct impact on these sectoral indexation mechanisms, as indexation is partially limited for employees with a reference salary above 4,000 EUR:

• For salaries up to and including 4,000 EUR gross, nothing changes and full indexation will continue to apply.
• For higher salaries, indexation is capped: all indexations only take effect up to 2% of the reference salary, capped at 4,000 EUR. Once a total wage moderation of 2% has been reached, the normal sectoral indexation mechanism without limitation will apply again.

Since there is no uniform indexation mechanism, the practical application of this limitation varies from sector to sector.

• If indexation equals 2%, the reference salary up to 4,000 EUR gross will be indexed at 2%. The portion above 4,000 EUR will not be indexed.
• If indexation is higher than 2%, the reference salary above 4,000 EUR will only be increased by the percentage exceeding 2%.
  
  Example: An employee has a reference salary of 5,000 EUR gross. The applicable index rate is 2.5%.
• Under normal indexation, this would be calculated as follows:
  5,000 EUR × 2.5% = 125 EUR
• However, under the centimes index, it will be calculated as follows:
  (4,000 EUR × 2%) + (5.000 EUR × 0.5%) = 105 EUR

• If the indexation is lower than 2%, the centimes index may require multiple indexations before a total wage moderation of 2% is reached.

The limitation is applied twice: a first time from June 2026 (“the first wage moderation period”) and again from January 2028 (“the second wage moderation period”).

For employers in sectors where wages are indexed this year still, the limitation of indexation must already be applied this year. In sectors that only index in January, such as Joint Committee 200, the limitation will only be applied for the first time in January 2027.

From 1 January 2028, the limitation will be applied a second time. The threshold amount of 4,000 EUR gross, increased in line with the pivot index for civil servant wages, will again be used as the reference.

This indexation limitation will be automatically processed in payroll calculations.

What is meant by the reference salary?

The reference salary is the gross fixed full-time base salary. Variable remuneration or bonuses, overtime pay, meal vouchers and eco vouchers, year-end bonuses, etc., are therefore not considered.

For part-time employees, the full-time equivalent must be calculated. Daily or hourly wages must also first be converted into a monthly salary to determine the reference salary.

The measure also applies to minimum wages, sectoral salary scales and pay grades, both at sector and company level, once this salary exceeds 4,000 EUR gross.

What is the employer “wage moderation contribution”?

In addition to the limitation of indexation, an employer wage moderation contribution is also introduced. Employers in the private sector will have to pay an additional contribution corresponding to half of the difference between normal indexation and the reduced indexation.

This contribution is introduced in several phases:

• During the first and second wage moderation periods, employers pay a special employer wage moderation contribution as soon as the indexation limitation is applied.
• Once the targeted wage moderation of 2% is reached in the first wage moderation period, this employer contribution is converted into a provisional consolidated wage moderation contribution.
• Once a 2% moderation has again been achieved in the second wage moderation period, the provisional consolidated wage moderation contribution is replaced by the final consolidated wage moderation contribution.

The calculation method for the (provisional and final) consolidated wage moderation contribution still needs to be determined by Royal Decree.

The various contributions will be calculated automatically in payroll.

Is the employer obliged to apply the centimes index?

If an employer decides to fully index reference salaries above 4,000 EUR anyway, they would be acting in violation of the law. However, the law itself does not provide for a specific sanction for this infringement.

That said, failing to apply the centimes index may have the following consequences:

• Possible breach of the wage norm: for 2025–2026, the wage norm is set at 0%. Fully indexing salaries above 4,000 EUR may result in additional labour costs on top of the statutory indexation. These additional costs count towards the wage norm and may therefore constitute a breach of it.
• Mandatory payment of wage moderation contributions: even if the employer does not apply the indexation limitation, they remain obliged to pay both the special and, subsequently, the consolidated wage moderation contribution.

Please do not hesitate to contact us for more information at legal@pro-pay.be.

In Belgium, social dialogue takes place at three levels: interprofessional/federal, sectoral, and company level. In recent months, the wage norm as well as various employment-related measures have been adopted at the federal and interprofessional levels, thereby serving as a basis for sectoral negotiations.

These negotiations were conducted within Joint Industrial Committee 201, resulting in a sectoral memorandum of understanding for the years 2026-2027 (valid from 1 June 2026 to 31 December 2027). Below, we provide an overview of the most important decisions applicable to your sector for the year and a half.

1. Mobility

Bicycle allowance

As from 1 June 2026, the amount of the bicycle allowance will increase to 0.29 EUR per kilometer travelled.

2. Individual right to free weekends

Employees working in stores with more than five members of staff will be able to request up to eight weekends off per calendar year, in addition to their main annual leave. If an employee starts working during the calendar year, the number of free weekends will be calculated pro rata based on the period of employment that year.

When an employee takes a free weekend, no additional regular inactivity day may be taken during that same week. The regular inactivity day that would normally fall on a weekday (for example, Tuesday) will be shifted to the weekend, ensuring the employee has the entire weekend off. The employee does, however, retain the right to take another type of leave, such as statutory vacation, a compensatory rest day, or leave of absence.

The scheduling of a free weekend will be determined in mutual agreement with the supervisor.

Taking a free weekend is not permitted in the following cases:

• During the months of July, August, and December;
• For weekends connected to public holidays: both weekends following a public holiday on Friday and weekends preceding a public holiday on Monday;
• For flexi-job employees and students.

3. Time credit and end-of-career

The existing collective labour agreements on time credit and end-of-career schemes are extended until 30 June 2029.

4. Miscellaneous

Sectoral Mediation Committee

The social partners plan to establish a Sectoral Mediation Committee as of 1 January 2027 for companies with fewer than 20 employees. Employees will be able to turn to this committee for conflict mediation. The committee will be financed through a new employer contribution equal to 0.05%, which will be automatically included in the payroll calculations from 1 January 2027 onward.

Action Plan Against Stress and Burnout

The social partners will start a collaboration with the organisation PULSO. Because of this collaboration, employees will have the opportunity to hold confidential consultations with psychologists of PULSO. The Social Fund of Joint Committee 201 would cover the start-up costs and half of the case-related costs for employers. Making use of PULSO’s services would remain entirely voluntary.

Since our previous newsletter of 19 January 2026, the government has not remained inactive. In this newsletter, we provide a structured overview of the main developments that have since been adopted or announced, as well as their practical impact for employers and employees.

1. Voluntary overtime: reform of the system

We already addressed this topic earlier this year. Detailed information on this matter can be found in our newsletters of 19 January 2026 and 3 April 2026.

The new rules will enter into force retroactively as from 1 April 2026, without any changes to the elements we presented in those publications. Although the law has not yet been officially published in the Belgian Official Gazette, the risk associated with applying the new regime before publication remains limited, as the new rules apply retroactively.

2. The Act on various employment provisions

Simplification of the rules regarding the introduction of working schedules in the working regulations

Before the reform, the law required that all full-time working schedules potentially applicable within the company be included in the working regulations.

The government has, however, decided to simplify this obligation. From now on, companies that no longer wish to include all such schedules in their working regulations may limit themselves to incorporating a general framework for working schedules, similar to what already exists for variable schedules.

Employees must still clearly know under which schedule they are working. This means that:

• Either the working schedule is included in the working regulations, and the individual employment contract refers to it;
  
• Or the working schedule is stated directly in the individual employment contract, in which case the working regulations must contain the general framework within which that schedule falls.
  

The introduction of such a framework into the existing working regulations constitutes an amendment to the regulations and therefore, requires compliance with the consultation procedure applicable to amendments of the working regulations.

These new rules are scheduled to enter into force on 1 June 2026.

New rules on the minimum weekly working time for part-time employees: from 1/3rd to 1/10th

Before the entry into force of the new legislation, the minimum weekly working time of a part-time employee had to amount to at least 1/3rd of the working time of a full-time employee within the company. The reform lowers this minimum threshold to 1/10th of a full-time schedule.

It nevertheless remains possible to derogate from this rule by means of a royal decree, a sectoral collective labour agreement, or a company-level CLA.

The new rules will apply to all employment contracts starting on or after 1 June 2026. As from that date, the working time of existing part-time employment contracts may also be reduced, provided that both the employer and the employee agree.

However, the rule establishing a minimum daily working period of 3 consecutive hours remains unchanged.

Abolition of the prohibition on night work

Until now, work performed between 8 p.m. and 6 a.m. was, in principle, prohibited unless an exception was provided for by law or royal decree. This prohibition will be abolished: employers will now be able to organise night work, provided that the applicable procedures are complied with (such as the conclusion of a collective labour agreement or an amendment to the work regulations).

In addition, the reform introduces a major change for the retail, logistics and e-commerce sectors: in these sectors, night work will be defined as work performed between 11 p.m. and 6 a.m.

This new definition will also affect night shift premiums. As from 1 June 2026, newly hired employees will no longer be entitled to a premium for work performed before 11 p.m., even if a sectoral collective labour agreement or internal rule previously granted such a premium from 8 p.m., 9 p.m. or 10 p.m. onwards. Derogations from this new rule will, however, remain possible.

The abolition of the prohibition on night work is scheduled to enter into force on 1 June 2026.

Limitation of the maximum notice period in the event of dismissal by the employer

Currently, no maximum notice period applies in the event of dismissal by the employer. The new law is now introducing a maximum notice period of 52 weeks for employment contracts starting on or after 1 June 2026. The same limit will apply where an employer chooses to pay compensation in lieu of notice rather than requiring the employee to serve the notice period.

CLA 90-bonus : mandatory electronic filing

The CLA 90-bonus is a non-recurring, results-related benefit. For more information regarding these bonuses, we invite you to read our newsletter on this topic.

As part of the procedure for introducing this bonus, a bonus plan must be drawn up and submitted to the Federal Public Service Employment, Labour and Social Dialogue. Until now, this filing could be made either in paper form or electronically. As from 1 June 2026, the filing of the bonus plan will be required to be made electronically only.

3. Introduction of the « springboard allowance” in the event of resignation

As from 1 March 2026, employees will, once during their career, be able to resign while retaining a temporary entitlement to unemployment benefits. This measure, introduced by the 2025 Program Law, marks a departure from the principle that resignation excludes entitlement to unemployment benefits.

This entitlement is subject to strict conditions: it may only be exercised once, for a maximum period of six months, and requires the employee to demonstrate at least 3.120 working or equivalent days at the time of resignation. An extension of up to 12 months is possible where the employee successfully completes training leading to a shortage occupation.

The request to convert the exclusion into entitlement to unemployment benefits must be submitted within 30 days and is irrevocable.

4. Measures announced mending final approval

• Reduced notice period : Currently, the notice period in the event of dismissal ranges from one week (for seniority of less than three months) to five weeks (between five and six months), whereas in the event of resignation it is one week for less than three months of seniority and two weeks for less than six months.
  
  Under this new measure, either party may terminate the employment contract of an employee with up to six months of seniority by giving one week’s notice. This measure implicitly reintroduces a short probationary period, allowing either party to terminate the contract with reduced notice, without the need to include a specific probation clause in the employment contract.
  
  However, this reduced notice period will only apply to employment contracts concluded after the entry into force of the new law. We will keep you informed once the law has been published.
  
• Indexation in cents : The entry into force of this measure is currently set for 1 June 2026. However, due to opposition from social partners as well as within Parliament, its final adoption remains uncertain. We will provide further details in a separate newsletter if the applicable legislation is published.
  

The days are getting longer and warmer, which means summer is on the way. This makes it the perfect moment to revisit the basic principles of student work.

Who is eligible for student work?

Since early 2026, student work rules have changed: students aged 15 and over can now be employed regardless of whether they have completed the first two years of secondary school, even if they are still in full-time compulsory education.

A student who graduates in June, can work with a student contract until 30 September of the same year.

However, a students who terminates their studies during the academic year is no longer considered a student and can no longer conclude a student contract, even if they do not immediately receive their degree.

The student can work a maximum of 12 consecutive months with the same employer.

Lower solidarity contribution for student work and quota of 650 hours

Under certain conditions, student work is exempted from ordinary social security contribution (ca. 28% for the employer and 13.07% for student). Student work is subject to a much lower solidarity contribution (5.42% for the employer and 2.71% for the student), provided that the following conditions are met:

• The student is employed under a student agreement that contains certain legally mandatory provisions and is concluded prior to start of the student work. The student contract is always a fixed-term contract with a maximum duration of 12 months.
  
• Since 2025, students are allowed to work up to 650 hours per year under the lower solidarity contributions. Hours worked beyond this quota of 650 hours are no longer subject to the lower solidarity contributions but instead to the ordinary social security contributions (as for a normal employee).
  
• The student can consult the number of hours worked at Student@work. He or she can download a certificate confirming the available hours of the quota. We highly recommend requesting this certificate in advance in order to be sure of the number of quota hours the student has left to work under the advantageous solidarity contributions.
  
• The student is only allowed to work during periods they do not have to be present at school.
  
• The employer has submitted a specific Dimona declaration for students prior to the start of the employment. If you prefer your Payroll Business Partner to submit this declaration, please inform them at least two working days before the start of the employment.
  

Salary and working conditions

You must pay students at least the minimum salary in the sector, as applicable to your other employees (or the minimum salaries on company level if more advantageous rules were agreed upon), unless the sector itself provides an exception for student work. For example, in JIC 200 (joint industrial committee for white-collar employees), specific minimum salaries are provided for students.

As a rule, the same labour law rules are applicable to students as to a normal employee. For example, students also have to receive a copy of the working regulations when they start their employment.

However, there are some exceptions to this general principle. A student contract contains a trial period of 3 days, students may work less than 1/3 of the weekly working time (in a 38-hour week, this implies that students may work less than 13 hours per week) and night work is prohibited in most cases for minors.

* New * With the expansion of the eligibility for student work, additional protective measures have been introduced for 15 year-old students:

• They may only perform “light work”, i.e. activities such as shelf stocking, retail sales assistance, logistical activities like receiving goods, storage, weighing…
  
• During the school year, their working time is limited to 2 hours per school days, 8 hours per non-school day and to 12 hours per week. During school holidays lasting at least one week, these limits increase to 8 hours per day and 40 hours per week.
  
• A rest period of 14 consecutive hours must be ensured between the end of one working day and the start of the next.
  

Enrolment certificate

As an employer, you must be able to prove that the person you hire is indeed a student. The NSSO may therefore require you to provide the student’s enrolment certificate for the current academic year upon their request.

With this in mind, we strongly recommend asking the student to provide you with a copy of their enrolment certificate before the start of the employment and keeping this copy available on the company’s premises.

What should you do as an employer?

Before the student contract starts:

• Request enrollment certificate and certificate student@work
• Sign the student contract
• Submit Dimona declaration – inform your PBP!

Upon start of employment: give the student a copy of the working regulations and ask them to sign an acknowledgement of receipt.

It’s that time of the year again! As of 28 April 2026, Tax-on-Web (MyMinFin) is officially open, allowing you to submit your return electronically.

As a Belgian tax resident, living and working in Belgium, you are required to file a personal income tax return with the Belgian tax authorities. In this return, you report your personal details and income so that the Belgian tax authorities can calculate your final tax liability.

The return you file this year relates to income year 2025. Individuals who moved to Belgium during 2025 and became tax residents must file a Belgian tax return for the first time this year.

Below is an overview of the applicable filing deadlines. These vary depending on:

• the method of filing (paper or electronic), and
• whether specific types of income are included

Unlike in the past, the filing deadline no longer depends on who submits the return (yourself or a tax advisor).

Paper filing

If you are filing a return in Belgium for the first time, the Belgian tax authorities will in principle send you a paper form by post during the month of May. You will recognize it by the brown envelope.

Did you not receive a form? Then you are required to request one yourself from your local tax office. We recommend doing so at the beginning of June to ensure sufficient time to file your return on time.

The deadline for submitting a paper return is 30 June 2026.

Electronic filing (Tax-on-Web)

You can also submit your return electronically via Tax-on-Web (MyMinFin). As mentioned above, this application has been open since 28 April 2026.

For electronic filing, the deadline is 15 July 2026.

You can log in easily via MyMinFin using your e-ID or the itsme app.

Specific situations – extended deadline

If your return includes specific types of income and you submit it electronically, an extended deadline applies until 16 October 2026.

This applies if:

• your return includes self-employment income or foreign professional income;
• you are reporting for the first time one or more of the following:
• foreign real estate
• alimony payment received from or paid to a person in a foreign country
• a loan concluded abroad
• a legal structure
• the application of the special tax regime for inbound taxpayers or researchers

Please note: if you fall into one of these situations but submit your return on paper, the deadline of 30 June 2026 still applies.

Pre-completed tax return

The Belgian tax authorities increasingly send a pre-completed tax return, based on available data.

If you receive a pre-completed tax return:

• Correct and complete? Then no action is required.
• Incorrect or incomplete? Then you must amend it:
• online via MyMinFin: no later than 15 July 2026
• on paper (if received by post): no later than 30 June 2026

Need assistance?

Feel free to contact us at tax@propay.be if you:

• would like more information about your personal situation;
• wish to organize a training session for your employees;
• need assistance with the preparation and filing of your tax return.

What is the EES?

On 10 April, the Entry/Exit System (EES) became fully operational in the 29 Schengen Member States. This new system replaces the traditional passport stamps for third‑country nationals (travelers who are not nationals of an EU Member State) entering the Schengen area for a short stay. A short stay corresponds to a maximum presence of 90 days within a 180‑day period.

The system automatically calculates the number of remaining short‑stay days. If a person holds a C‑type visa (short stay) with a shorter validity period, the EES monitors that specific limit.

When a traveler exceeds the authorized duration, the system automatically issues an “overstay notification” to the competent authorities. This may result in a fine or even an entry ban.

Objective: to speed up border checks, strengthen security, and prevent illegal immigration.

How does it work?

Third‑country nationals crossing a Schengen border for the first time since the introduction of the EES must provide their personal data. Border authorities scan their fingerprints and/or take a facial image. These data are stored in a digital database.

Upon a subsequent entry into the Schengen area, only the fingerprints and facial image are verified. Third‑country nationals holding a biometric passport may now use automated border control gates.

Border authorities, visa services, immigration authorities and police services of participating countries have access to the EES. For the time being, travelers do not have direct access to their own EES data. In the future, an online tool will be available that allows them to view their entries and exits.

Who does the EES apply to?

The EES applies to all third‑country nationals undertaking a short stay in the Schengen area, whether they are subject to the C‑type visa requirement or not.

The EES does not apply to third‑country nationals holding a D‑type visa (long stay), and persons holding a residence permit issued by a Schengen Member State.

What additional administrative obligations apply for a short stay in Belgium?

In addition to EES registration, Belgium requires an additional declaration for travelers who are not staying in a hotel. This declaration, which must be submitted to the competent municipality, was simplified on 10 April 2026.

Third‑country nationals

• They must declare their stay to the municipality within three days of their arrival.
• Since 10 April 2026, this declaration may also be completed online via My address in Belgium. The traveler then receives a confirmation by email.
• Third‑country nationals staying based on a visa or residence permit issued by another Schengen State cannot use the online declaration and must appear in person at the municipality to complete their arrival declaration.

EU citizens (and their third‑country national family members)

• They are not registered in the EES.
• They must declare their stay in Belgium within ten days.
• They may also complete this declaration online via My address in Belgium.

Also expected at the end of 2026: ETIAS

At the end of 2026, in addition to the EES, the ETIAS system (European Travel Information and Authorization System) will be introduced in the 29 Schengen Member States, as well as in Cyprus.

ETIAS is a mandatory prior travel authorization for third‑country nationals not subject to a visa requirement and travelling to Europe for a short stay. With a valid ETIAS authorization, travelers will be able to make multiple short stays in the countries concerned.

ETIAS is comparable to the digital travel authorization systems used by the United States (ESTA) and the United Kingdom (ETA).

The authorization is linked to the passport. It is valid for up to three years, or less if the passport expires before that date.

Pro-Pay remains at your disposal for any questions relating to the employment of foreign workers and can handle single permit or work permit applications on behalf of your company. For further information, you may contact: legal@propay.be

On 12 March 2026 the European Court of Justice (‘ECJ’) ruled that the 7% surcharge imposed on non-residents who are taxable in Belgium on their Belgian sourced income is a hindrance to the free movement of workers.

By way of background information, the tax burden of Belgian tax residents is increased with a communal surcharge varying between 0% and 9% depending on the Belgian commune where one resides. As non-residents are not attached to a Belgian commune of residence, there is an equivalent surcharge which is uniformly set at 7%. The latter percentage is in certain instances higher than the communal surcharge imposed on a Belgian tax resident, implying that non-residents can face a more substantial tax burden than Belgian tax residents in a similar situation. This is considered contrary to EU regulations.

A simplified example may clarify the impact. Assume a taxpayer with a taxable salary of EUR 70.000 triggering a tax burden of EUR 23.297,51, which leads to the following:

• Non-resident facing a surcharge of 7%
  
• EUR 23.297,51 x 7% = EUR 1.630,83
  

• Belgian tax resident facing a communal surcharge of 4,6%
  
• EUR 23.297,51 x 4,6% = (EUR 1.071,69)
  

• Surplus due by the non-resident EUR 559,14
  

While the Belgian government is still assessing the impact of this ECJ ruling, the ECJ ruling implies that the Belgian tax authorities (or Belgian tax courts) can no longer impose a uniformly fixed 7% surcharge to non-residents. In the absence of a legally valid alternative, it can reasonably be argued that the surcharge should effectively be reduced to 0% for non-residents until new legislation is introduced. This creates a temporary opportunity for tax savings, which in the above example amounts to EUR 1.630,83.

Impacted non-residents can already take action now, i.e.

• Either by filing a formal tax complaint, which must be done within a period of one year following the dispatch of the tax assessment form,
• Or by applying for ex officio detaxation, in which case the non-resident tax payer can claim a rectification over the last five years.

Please e-mail tax@propay.be if you would like to receive more information or require assistance.

Employees who use their own car to travel for professional purposes, can receive a reimbursement from their employer for the costs incurred. On the other hand, employees who have been granted an electric company car by their employer may, under certain conditions, obtain reimbursement for the cost of electricity used to charge the car at home. Both types of allowances are adjusted quarterly.

1. Mileage allowance for your own vehicle

The authorities have fixed a maximum lump sum per kilometre that is accepted as a cost proper to the employer (“mileage allowance”). This mileage allowance is exempt from social security contributions and taxes on condition that the maximum amount per kilometre per year is not abnormally high (maximum 24 000 km per year). If the maximum number of kilometres travelled per year is exceeded, proof must be provided.

The new amount applicable starting from 1 April 2026 until 30 June 2026 is 0.4327 EUR per kilometre. This is quasi identical to the previous amount (0.4326 EUR).

Alternatively, it is possible to opt for the annual indexation of the mileage allowance. An employer can therefore choose between the quarterly indexed amounts or the annual indexed amount, which amounts to 0.4449 EUR per kilometre for the period from 1 July 2025 to 30 June 2026. In the latter case, the employer should thus maintain the same amount during the entire period.

The quarterly and yearly indexed amounts are maximum amounts. Employers can reimburse the driven kilometres at a lower rate without any discussion. A higher reimbursement is also possible, but in that case, the burden of proof lies with the employer and the employee to prove that the allowance is in line with the actual cost.

2. Reimbursement of the company cars electricity fees

Electricity charged from home through a smart charging station can be reimbursed to the employee exempt from social security contributions nor taxes. Reimbursement is normally based on the quarterly CREG rates applicable in the region where the workers reside.

From 1 April 2026 until 30 June 2026, the following rates are applicable:

• Flemish Region: 31.91 eurocents/kWh
• Brussels-Capital Region: 35.55 eurocents/kWh
• Walloon Region: 36.36 eurocents/kWh

The employer may also choose to reimburse electricity charged at home regardless of the place of residence of the workers. In this case, the maximum rate per kWh corresponds to the lowest rate applicable in one of the regions for the quarter in question (the Flemish Region for this quarter). This choice applies for the entire calendar year.

As already mentioned in our previous newsletter, at the end of 2025 certain changes were implemented in respect of the special tax regime for inbound taxpayers and inbound researchers retroactively – effective 1 January 2025 -, i.e. the annual salary threshold was lowered from EUR 75,000 to EUR 70,000, the tax exempt allowance (the so-called ‘costs proper to the employer’) increased from 30% to 35% maximum and the annual allowance cap of EUR 90.000 was abolished.

On 1 April 2026, the Belgian tax authorities have issued a Circular letter commenting on the tax implications of the retroactively implemented changes and clarified the following:

1. Inbound taxpayers and inbound researchers who already benefitted from the special tax regime prior to the implementation of the above changes
   The employer and inbound taxpayer/researcher are free to update the employment contract with retroactive effect to reflect the positive impact of the increased allowance, i.e. by lowering the gross salary and by increasing the percentage of the tax free allowance.It is, however, imperative that such a retroactive change to the employment contract is agreed upon by 1 July 2026 at the latest and that the relevant payroll documents (fiscal voucher 281.10 and wage tax withholding returns) covering income year 2025 are corrected.Any update beyond this date will not be accepted.
   
2. Inbound taxpayers whose employment relationship started between 1 January 2025 and 9 January 2026 and who were initially not eligible to benefit from the special tax regime (annual salary threshold not met) but who have become eligible now as a result of the recent legal changes
   A special application deadline applies for this particular category (ending on 9 April 2026) and, provided that this is met, their employment contract can also be updated similarly to what is outlined under point 1 above.
   

For the sake of completeness, as already outlined in our separate newsletter, the above changes only apply at a tax level, not at a social security level (as reiterated by the Belgian social security administration in the administrative instructions covering Q1 2026).

! It’s time to act!

E-mail tax@propay.be if:

• You would like more information about the special tax regime;
• You would like assistance with the preparation and submission of the (special) application for special tax regime;
• You would like assistance in relation to re-evaluating existing compensation packages and/or updating employment contracts.