Capital gains tax for non-residents

Capital gains tax for non-residents

  • What tax do I have to pay, as a non-resident, on the sale of immovable property located in Belgium when I use the immovable property for my professional activity?

    The capital gains that you realise when selling immovable property located in Belgium are subject to withholding tax, provided that the capital gains are included in your profits or proceeds taxable in Belgium.

    You will have to declare those capital gains and withholding tax in a non-resident tax return (natural persons). When calculating the amount of tax owed by non-residents, the withholding tax already paid will be taken into account.

    Depending on the period within which you sell the immovable property, the capital gains are taxable jointly in the taxation of non-residents or at a separate rate of 16.5%.

  • What tax do I have to pay, as a non-resident, on the sale of immovable property located in Belgium, outside the scope of a professional activity?

    In principle, the capital gain is not taxable in the taxation of non-residents (natural persons), unless you realise that capital gain on immovable property located in Belgium:

    outside the scope of the normal management of private assets

    Such income is subject to withholding tax at the rate of 30.28% of the gross amount.

    That withholding tax constitutes the final tax, and therefore cannot be declared in a non-resident tax return (natural persons).

    within the scope of the normal management of private assets, but within a period laid down by law

    • for land, the capital gain will be taxable if you sell it within 8 years of acquisition
    • for buildings, the capital gain will be taxable if you sell it within 5 years of acquisition

    Specific periods apply to immovable property that you have acquired as a gift or to buildings that you construct yourself.

    These capital gains are subject to a separate taxation of 33% or 16.5% of the capital gain, depending on the nature of the immovable property (built or unbuilt) and the period within which you sell the property.

    This separate taxation constitutes the final tax. You therefore cannot declare that capital gain in a non-resident tax return (natural persons).

    What is meant by ‘normal management of a private asset’?

    The management of a private asset consists of actions that a ‘prudent man’ would normally carry out to optimise the value of the asset. The assets consist of the movable and immovable property and portfolio values acquired through his own savings, by inheritance, as a gift or via the reinvestment of alienated property.

  • What tax do I have to pay, as a non-resident, when I sell shares?

    I realise capital gains in the performance of my professional activity

    The capital gains that you realise when you sell shares are taxable as profits or proceeds in the taxation of non-residents (natural persons), provided that the capital gains are included in your profits or proceeds taxable in Belgium.

    In the case of shares forming part of the business assets of the permanent establishment/fixed base located in Belgium, the latter has the right to levy tax on them under the agreement with the non-resident person’s country of residence.

    You must therefore declare those profits or proceeds in a non-resident tax return (natural persons).

    The capital gain is taxable jointly or at a separate rate of 16.5%, depending on the period within which you sell the shares. However, the capital gain is jointly taxable to the extent that it corresponds to a previously assumed capital loss.

    I realise capital gains outside the scope of the performance of my professional activity

    In this situation, consult the bilateral agreement concluded between Belgium and the non-resident person’s country of residence. You can check which of the two countries has the right to tax the capital gains. The most common rule is that the beneficiary’s country of residence has the right to tax them, but there are exceptions so it is important to consult the agreement.