Kerem Gülenç
Abstract
Belgium introduced a new personal income tax on capital gains derived from financial assets by private individuals who are Belgian tax residents. The tax applies to transfers for valuable consideration (e.g. sale) and is structured by three taxation regimes: a 33% tax on internal capital gains, significant shareholdings are subject to progressive rates up to 10%, and a 10% tax on other financial assets. Only gains accrued after 31 December 2025 are taxable. The reform also introduces exit tax and step-up rules for taxpayers. Finally, the existing general anti-abuse provision is also fully applicable.
Introduction
As of 1 January 2026, Belgium started to implement a new capital gains tax on financial assets, as part of an intended personal income tax reform.
The new tax applies, as a rule, to any transfers of financial assets, except for donations, and inheritance.
Financial assets include financial and investment products held by private individuals, irrespective of whether they are of Belgian or foreign origin. These assets include, in particular, listed and unlisted securities such as shares, bonds, ETFs, options and derivatives; insurance-based savings and investment products; currencies (including cash holdings), investment gold, and cryptocurrencies.
Certain financial assets are excluded from the scope of the capital gains tax, including pension savings accounts, group insurance schemes and long-term savings contracts.
The reform introduces three new types of taxable capital gains on financial assets:
1) Internal Capital Gains : Taxed at 33%
When shares are sold to a controlled holding company the gain realized on the sale will be taxed at 33%.
2) Capital Gains on Significant Shareholdings : Progressive Tax up to 10%
A significant shareholding is defined as holding at least 20% of a company’s share capital. The 20% shareholding must be held at the time of the transaction and falling below it (e.g., due to a capital increase) disqualifies the gain from this second category.
Capital gains on significant shareholdings (20% or more) are taxed at preferential progressive rates. The first 1 million EUR of capital gains is exempt. Any gain exceeding this threshold is taxed at progressive rates ranging from 1.25% to 10%, depending on the amount of the gain. The 1 million EUR exemption can only be used again after five years.
However, the existing personal income tax rule under the Belgian Income Tax Code remains applicable, whereby the sale of a significant shareholding (for that rule i.e. at least 25% held during the five years preceding the sale) to a buyer outside the EEA, a legal person, is subject to a fixed tax rate of 16.5%.
3) Capital Gains on Other Financial Assets : Taxed at 10%
This third category covers all other private financial assets, broadly defined, including shares, funds, bonds, and crypto-assets. For this category, the legislation provides for an annual exemption from taxation on the first 10,000 EUR of realised capital gains.
Any unused portion of the exemption may be carried forward to future tax years, meaning that the unused part of the exemption can be transferred and used in subsequent years, subject to a maximum cumulative carry-forward amount of 5,000 EUR (carry-forward rule).
Historical capital gains are exempted
To avoid retroactive taxation in all three categories of taxable capital gains, “historical capital gains” in value before 1 January 2026 are not taxable under the new capital gains tax. Only the gain accrued after 31 December 2025 will be taxable. The historical capital gains remain subjected to the existing rules (normal administration of private assets test).
New Exit Rule(s)
When a taxpayer emigrates from Belgium, unrealised capital gains become taxable under the exit tax regime, as they are deemed to be realised at the time of emigration.
If the taxpayer moves to another EU country, to a EEA country or to a country with which Belgium has a double tax treaty, the exit tax is not immediately due; instead, payment is automatically postponed for a period of two years.
By contrast, if a taxpayer moves to a country that does not have a double tax treaty with Belgium, the exit tax is not automatically deferred. In that case, a deferral may be granted only upon request and usually depends on the taxpayer providing sufficient security to guarantee payment of the tax.
Entry tax rule
In the case of immigration to Belgium, specific rules apply to foreign taxpayers who become Belgian tax residents.
As a general principle, a step-up mechanism is provided, meaning that the acquisition value of the assets is reset to their market value on the first day the taxpayer becomes subject to Belgian personal income tax.
Anti-abuse Rules
The tax administration may apply the general anti-abuse rule to the new capital gains tax and recharacterize transactions where their principal purpose is to obtain an undue tax advantage and they do not reflect genuine economic purposes.
The taxpayer may provide evidence to the contrary of the anti-abuse application by demonstrating valid economic purpose, or by proving that the beneficiary is subject to a normal level of taxation comparable to Belgium.
Paying capital gains tax does not necessarily put an end to the discussion. Depending on the facts, the tax administration may still argue that the transaction constitutes abnormal management of private assets or amounts to tax abuse.
