The information below is a brief summary of the Belgian tax regime for investors in OLOs and Treasury certificates.
This summary does not prevent the interested investor from consulting his financial intermediary or the tax administration to know the regime specifically applicable to him. So it is possible that your financial intermediary is obliged to effect certain notifications such as in the framework of the "Foreign Account Tax Compliance Act" (FATCA).
Additional information is available from the Contact center of the Federal Public Service Finance.
(Tel.: +32 2 57 257 57, usual rate, available on business days between 8 a.m. and 5 p.m.).
The X/N system of the National Bank of Belgium applies to OLOs and Treasury certificates. This implies the following :
For non-exempt investors, there is a withholding tax (the tax rate currently amounts to 30%) on yields from OLOs and Treasury certificates.
Non-exempt investors mainly include residents of the Kingdom of Belgium such as individuals or certain non-profit-making organisations.
For certain exempt investors, there is no withholding tax as far as OLOs and Treasury certificates are held in an exempt securities account opened with the X/N system of the National Bank of Belgium or with a participant in this system.
Exempt investors are the entities included in Article 4 of the Royal Decree of 26/05/1994. This concerns among others:
- investors who are not regarded as residents of the Kingdom of Belgium as far as Belgian taxes are concerned.
- Collective investment undertakings governed by foreign law which have joint assets managed by a management company on behalf of the participants can be exempted only if their shares are not subject to any public issuance in Belgium or are not marketed in Belgium.
- Natural persons and non-profit-making organizations are exempted on the condition that they do not hold OLOs and Treasury certificates via a Belgian institution (in the sense of Article 229 of the 1992 Belgian income tax code : "Code des Impôts sur les revenues 1992 / Wetboek van de Inkomstenbelastingen 1992") and do not conduct professional activities in the Kingdom as defined in Article 228, paragraph 2, sub-paragraph 4 of the Tax Code).
- all resident companies in the sense of Article 2 of the 1992 Tax Code.
When opening an exempt account with the X/N system of the NBB or with a participant in this system, an exempt investor is required to provide a proof of its status as an exempt investor in a form approved by the Minister of Finance.
There is no continuous statement requirement for exempt investors. However, participants have to deliver annual statements to the X/N system of the NBB as to the exempt status of each investor for whom they hold OLOs and Treasury certificates in an exempt account.
Apart from certain principal strips, stripped OLOs (“strips”) may only be held by exempt investors in an exempt account.
Investors who are not residents of the Kingdom as far as Belgian taxes are concerned and are not holding OLOs and Treasury certificates through a Belgian establishment and do not conduct any Belgian professional activities will not incur or become liable for any Belgian tax on income or capital gains or other like taxes by reason only of the acquisition, ownership or disposal of OLOs and Treasury certificates provided that they hold their OLOs and Treasury certificates in an exempt account.
The acquisition or transfer of OLOs and Treasury certificates is not subject to any Belgian stamp, value added tax or other transfer tax.
The Law of 17 February 2021 introducing an annual tax on securities accounts has been published in the Belgian Official Gazette on February 25, 2021. The law introduces an indirect tax on securities accounts (the “Tax on Securities Accounts”) which applies to securities accounts held by resident individuals, companies and legal entities, irrespective as to whether these accounts are held, with a financial intermediary which is established or located in Belgium or abroad. The tax also applies to securities accounts held by non-resident individuals, companies and legal entities with a financial intermediary established or located in Belgium.
Belgian resident and non-resident individuals, companies and legal entities will be taxed at a rate of 0.15 per cent. on the average value of qualifying financial instruments held on one or more securities accounts during a reference period of twelve consecutive months (in principle) starting on 1 October and ending on 30 September of the subsequent year. No Tax on Securities Accounts will be due provided that the average value of the qualifying financial instruments on those accounts amounts to less than € 1,000,000 during the specific reference period. If, however, the average value of the qualifying financial instruments on those accounts amounts to Euro 1,000,000 or more, the Tax on Securities Accounts will be due on the entire average value of the qualifying financial instruments on those accounts during the specific reference period (and, hence, not only on the part which exceeds the Euro 1,000,000 threshold). However, the amount of the Tax on Securities Accounts is limited to 10 per cent. of the difference between the average value of the qualifying financial instruments on those accounts and Euro 1,000,000. This cap no longer applies when the tax base reaches the amount of 1,015,228.42 euros.