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Reductions and exemptions

The reductions and exemptions apply both to inheritance tax (residents) and to duty on the transfer of property mortis causa (non-residents).

  • Spouses and legal cohabitants: exemption for the family home

    Surviving spouses or legal cohabitants receive a full exemption on their net share of the immovable property:

    • that was the deceased person’s main residence and
    • in which the deceased person lived for at least the five years preceding the date of his or her death.

    The net share is excluded from the tax base.

    Conditions

    • These persons must be the surviving spouse or legal cohabitant, irrespective of their degree of blood relationship with the deceased person.
    • The deceased person can be a resident (inheritance tax) or a non-resident (duty on the transfer of property mortis causa).
    • The immovable property must be located in the Walloon Region.
    • An extract from the population register or the register of foreign nationals can be provided as proof of the main residence, unless otherwise indicated.
    • This can be the last common residence of the spouses or legal cohabitants if they ceased to cohabit as a result of separation or force majeure or for compelling medical, family, social or professional reasons.

    How do I apply?

    The full exemption is usually granted automatically, but you must apply for it expressly in the declaration of estate if you ceased to cohabit as a result of separation or for compelling reasons. In that case, you must provide proof of the force majeure or compelling reasons.

  • Lineal heirs: reduced rate for the main residence

    A reduced rate applies to the net share of lineal heirs in the family home.

    Part of the net share in EUR Percentage per bracket Total tax from previous brackets
    from to
    0.01 25 000 1 %
    25 000.01 50 000 2 % EUR 250
    50 000.01 175 000 5 % EUR 750
    175 000.01 250 000 12 % EUR 7 000
    250 000.01 500 000 24 % EUR 16 000
    over 500 000 30 % EUR 76 000

    How do I apply?

    You must apply for the reduced rate expressly in the declaration of estate.

  • Spouses, legal cohabitants and lineal relatives: partial exemption from inheritance tax

    Reduction

    The first EUR 12 500 of the net share of spouses, legal cohabitants or lineal heirs in the estate is exempt from tax.

    If the net share is EUR 125 000 or less, they receive an additional exemption of EUR 12 500 in the second bracket, amounting to a total exemption of EUR 25 000.

    Additional reduction for children under the age of 21

    Children of the deceased person who are under the age of 21 receive an additional exemption of EUR 2 500 for each full year remaining until they are 21.

    In addition to this, the spouse or legal cohabitant receives half of the additional exemption paid to all of the common children together.

    Example

    Dirk De Smet dies leaving his daughter Hilde as his heir. Hilde is 17 years and 6 months old.

    After deducting funeral costs and Dirk’s debts, the value of the estate is EUR 150 000.

    Hilde is entitled to the following exemptions:

    • a tax-free sum of EUR 12 500 and
    • an additional tax-free sum of EUR 2 500 x 3 (= full years until she is 21) = EUR 7 500.

    Total: EUR 20 000 tax free.

    The inheritance tax payable by Hilde is calculated as follows.

    12 500 exempt sum
    7 500 exempt sum
    5 000 at 4 % = EUR 200
    25 000 at 5 % = EUR 1 250
    50 000 at 7 % = EUR 3 500
    50 000 at 10 % = EUR 5 000
    Total = EUR 9 950

  • Heirs with at least three children under the age of 21: inheritance tax reduction

    Heirs with at least three living children under the age of 21 at the time of the deceased person's death receive a 2 % reduction in inheritance tax for each of those children, up to a maximum of EUR 62 per child.

    The deceased person's partner receives a 4 % reduction for each child under 21, up to a maximum of EUR 124 per child.

  • Property that is included in the estate of another deceased person within a year: 50 % inheritance tax reduction

    If the inherited property is included in the estate of one or more other deceased persons within a year of the deceased person’s death, the inheritance tax due on it is halved.

    However, the amount of the reduction must not exceed the inheritance tax levied on the previous estate.

  • Testamentary gifts to authorities: inheritance tax exemptions and reductions

    There is an exemption from inheritance tax for legacies (testamentary gifts) to:

    • the Walloon Region;
    • the French Community, the Brussels Capital Region, the Brussels Agglomeration; the Common, French and Flemish Community Commissions; the German-Speaking Community, the Flemish Region and the Flemish Community;
    • entities comparable to the above, that were established under, and are subject to, the laws of another Member State of the European Economic Area;
    • a Federal State and a Member State of the European Economic Area;
    • legal entities established by the above entities.

    There is a reduced rate of 5.5 % for legacies to:

    • the provinces;
    • the municipalities;
    • provincial and municipal public bodies;
    • inter-communal associations;
    • autonomous municipal companies;
    • legal entities of another Member State of the European Economic Area comparable to the entities listed above;
    • companies recognised by the ‘Société wallonne du Logement’ (Waalse Huisvestingsmaatschappij) [Walloon Housing Company];
    • the ‘Fonds du Logement des Familles nombreuses de Wallonie’ (Woningfonds van de Kroostrijke Gezinnen van Wallonië) [The Walloon Social Housing Fund];
    • the social entities referred to in Article 191 of the Walloon Housing Code, which are recognised by the Walloon Government as social housing agencies, social community networks or associations for the promotion of housing.

    There is a reduced rate of 7 % for legacies to:

    • national and international not-for-profit organisations;
    • friendly societies or national unions of friendly societies;
    • professional associations;
    • private foundations
    • public-interest foundations.
  • Property in Natura 2000 areas/forests: exemption from inheritance tax

    There is an exemption from inheritance tax for immovable property in Natura 2000 areas. These are valuable nature conservation areas which are listed in the Belgian Official Gazette.

    Under certain circumstances, the tax can be reduced for immovable property in an area that is eligible for inclusion in the Natura 2000 network and subject to the primary protection regime.

    Additional exemptions can also be granted for:

    • the value of the trees growing in the forests and woods specified in the Forestry Code and
    • the value of the shares and equivalent interests of a forest management group referred to in the Law of 6 May 1999 promoting the establishment of civil forest management group companies.

    How do I apply?

    You must apply for the exemption in the declaration of estate. You should contact your notary or a Legal Security Office (Kantoor Rechtszekerheid | Bureau Sécurité juridique | Amt Rechtssicherheit) to obtain specific information about the process.

  • Spouses, legal cohabitants and lineal heirs: exemption for death caused by an extraordinary act of violence

    There is a EUR 250 000 exemption from inheritance tax for death caused by an extraordinary act of violence.

    An extraordinary act of violence is defined as ‘any intentional act of violence committed by a single person or a group of persons, which caused a feeling of fear and insecurity among the general public on account both of the violence itself and the seriousness of its consequences, and of the attack on the physical and/or moral integrity of the members of the public present when the act was committed.’

    Who is eligible?

    • spouses or legal cohabitants;
    • lineal heirs;
    • collateral heirs up to the second degree;
    • heirs who are blood relatives in the direct line of descent up to the first degree and in the collateral line up to the second degree.

    How do I apply?

    Attach a certificate from the ‘Direction générale opérationnelle Fiscalité’ (Operationeel Directoraat-generaal Fiscaliteit) [Operational Directorate General for Tax] of the Walloon Administration, confirming that the deceased person died as a result of an extraordinary act of violence, to the declaration of estate.

    You can contact the Walloon Tax Administration for more information about the certificate.

  • Protected immovable property: exemption from inheritance tax for maintenance work

    Heirs who inherit the ownership or usufruct of protected monuments may obtain an inheritance tax exemption. An amount equivalent to the exemption must be invested in the monument.

    Who is eligible?

    • spouses or legal cohabitants;
    • lineal heirs;
    • collateral heirs up to the third degree.

    What are the conditions?

    • You must invest an amount equal to the inheritance tax exemption in maintenance, surveys and renovation of the protected monument within ten years of the date of the deceased person’s death.
    • Once you have completed the investments, you must obtain a certificate from the Walloon Government confirming that the amount of the investments was at least equal to the amount of the inheritance tax exemption.
    • All of the heirs must retain their right of ownership or usufruct over the monument until the certificate has been obtained. However, the exemption will still apply if the ownership or usufruct changes as a result of a death or a transfer between spouses, legal cohabitants, lineal relatives or collateral relatives up to the third degree.

    Important: if this condition is not met, all of the heirs who received the exemption must pay inheritance tax, unless this was a result of force majeure or for compelling administrative reasons.

    How do I apply?

    • Apply for the exemption in the declaration of estate (it is not automatic).
    • State the date and the decision by which the immovable property was protected and attach a copy of the decision.
    • Attach a list of the investments required to the declaration. You can obtain the list from the Walloon Government (please note: the Walloon Government needs at least 45 days to provide the list).
  • Transfer of businesses: reduced inheritance tax rate (0 %)

    In some cases and under certain conditions, inheritance tax on the net share of a business can be reduced to 0 %, if the succession or the matrimonial property regime contains a right in rem resulting from the death.

    To obtain information about your specific situation, you should contact your notary or a Legal Security Office (Kantoor Rechtszekerheid | Bureau Sécurité juridique | Amt Rechtssicherheit).

  • Undeveloped immovable property with a long-term lease or career-long lease: reduced rate (from 1 January 2021)

    Inheritance tax on undeveloped immovable property in the Walloon Region with a long-term or career-long lease can be reduced under certain circumstances.

    Long-term lease

    The reduction is:

    • 55 % on the first 4 hectares;
    • 30 % on the remaining hectares.

    Career-long lease

    The reduction is:

    • 75 % on the first 4 hectares;
    • 50 % on the remaining hectares.

    The reduction is 10 % lower if the lessee was over 35 years of age when the lease was entered into.

    The lease must be:

    • reported to the ‘Observatoire foncier’ (Grondwaarnemingscentrum) [Land Survey Centre] and
    • entered into by an official document in accordance with the rules governing leases in the Civil Code.
  • Any questions?