The VAT regime will apply to properties for professional use from 2018. An end to complex tax arrangements by way of tax optimisation? All the details.

It is already the case with our neighbours, but Belgium used to be an exception. From now on, it will be possible to apply VAT to the rental of properties for industrial use. This decision was made by the Michel government when preparing its 2018 federal budget, the famous 2017 "summer agreement".

What will change?

Specifically, the measure will enable property developers to reduce their construction costs. From 2018, they will be able to recover the 21% VAT invoiced by contractors when constructing a property. Until now, as odd as it may seem, this was impossible.

Three aims in sight:

• On the one hand, to make Belgium more attractive from a tax perspective for companies wanting to set up their operational or management headquarters in our country;
• On the other hand, the measure will also entail a simplification of administrative and tax procedures: previously, construction and rental of properties to companies was subject to a series of... tax arrangements;
• Finally, the most eagerly awaited consequence: to lower lease rental costs.

"It allows for lower rental prices due to a significant reduction of charges on building construction and foundation costs. On the other hand, it will no longer be necessary to set up complex tax arrangements for tax optimisation purposes."
Johan Van Overtveldt, Minister of Finance, in charge of Combatting Tax Fraud.

For instance:

A EUR 500,000 building generates 105,000 in VAT. Currently, VAT at 21% is applied to the company's lease rental. In future, this will be recoverable.

Retroactive effect?

No, the system, which should be emphasised is optional, only applies to new contracts entered into as from 1 January 2018, where a landlord lets a property to a professional tenant. This is clearly a B2B perspective. Trade-off: the individual or the company will be bound to use it for professional or industrial activities eligible for VAT. 

Thinking about leasing a company car? Not sure which options are available? Below is an overview of all our available leasing options. That way you can determine which type of leasing is right for you. What's more, our partner Arval has a top deal, valid until 30 November 2024: drive the new electric BMW iX1 eDrive20 or BMW i4 Gran Coupé for a very advantageous all-in price.

Financial or operational leasing?

The same reasoning applies to both financial and operational leasing: you pay a leasing company for a specific period, usually four or five years. In both cases, the leasing company is the legal owner of the car. You do, however, have the option to purchase the car at the end of the contract. In financial leasing, the amount of the purchase option is known from the start of the contract whereas with operational leasing, the amount is determined at the end of the contract based on the car's market value.

'Including services'

This is one of the major advantages of operational leasing versus financial leasing: the taxes, (comprehensive) insurance, maintenance and costs (except fuel) are all included in the rental price. What's more, you enjoy additional services such as summer and winter tyres, roadside assistance and a replacement vehicle. All you need to do is pay a specific amount each month and that's it. In short, you get to drive with peace of mind: everything has been paid for, except for the fuel.

Tax implications?

The purchase option has tax implications: for a financial lease, you depreciate the investment asset and deduct the interest on your tax return. The car is listed as an asset on your balance sheet. For an operational leasing contract, the full rental price is processed as a cost. Tax deduction limits apply in both cases and you may have to take the professional use of the car into account. Equally important: the VAT is paid monthly on the rental price and not in one go, allowing you to use your lines of credit for other investments.

Get our top deal

Our exceptional offer is valid until 30 November 2024: you can lease the new electric BMW iX1 eDrive20 or BMW i4 Gran Coupé under an operational leasing contract at an affordable and exclusive price, including all services.

Arval Belgium SA, Ikaroslaan 99, 1930 Zaventem – RPM Bruxelles – TVA BE 0436.781.102, intermédiaire en assurances à titre accessoire, inscrit auprès de la FSMA sous le numéro 047238 A. Sous réserve d’acceptation de votre demande.

Arval Belgium nv, Ikaroslaan 99, 1930 Zaventem – RPR Brussel – BTW BE 0436.781.102, nevenverzekeringstussenpersoon geregistreerd bij de FSMA onder het nummer 047238 A. Onder voorbehoud van aanvaarding van uw aanvraag.

The bill to introduce this obligation in Belgium has been submitted to the Federal Parliament. If the draft bill is approved, B2B e-invoicing will become mandatory from 1 January 2026. Our experts explain why Belgium wants to introduce these new rules, what the implications are for your company and how we can better support you.

“The bill is consistent with international developments and initiatives at the European level,” says Nicolas De Vijlder, Head of Beyond Banking at BNP Paribas Fortis. "Europe's ambition is a harmonised digital standard. Structured e-invoicing between companies will also reduce the administrative burden of invoicing, enabling companies to work more efficiently and increase their competitiveness. The automation of VAT declarations will also help governments prevent tax fraud and adjust economic policies based on more qualitative data.”

Evolution rather than a revolution

“The new legislation is an evolution rather than a revolution,” adds Erik Breugelmans, Deputy Managing Director at BNP Paribas Factoring Northern Europe. "Digitalisation is becoming pervasive at all levels of society, as we have seen with the increase in electronic payments, as well as the additional obligations in recent years regarding electronic invoicing to the government. In this sense, the bill for mandatory electronic invoicing between companies is a logical next step. Our bank is happy to contribute to this process, although we do not intend to offer the same services as accounting software or fintechs. However, we are happy to help our customers with payments and financing."

The impact on businesses

“Customers need to be aware that the new regulations will have an impact on their internal and external processes,” continues Erik Breugelmans. "The majority of Belgian companies mainly serve an international market, which means that the introduction of electronic invoicing will be more complex for them than for companies operating in the domestic market. As the legislation will be introduced in one go, they need to start preparing now."

“The new rules will affect a company’s accounting department as well as its IT department,” emphasises Nicolas De Vijlder. "The procedural requirements are key, otherwise the automated process will not work. However, one of the main benefits of advanced automation is that everything can be done faster and more efficiently. The time between sending an invoice and paying it will be shorter and cash flows more predictable. In addition, it will also reduce the risk of error and fraud, as all transactions will pass through a secure channel."

Ready to offer you even more and better support

“Thanks to the far-reaching digitisation resulting from the new regulations, we will be able to further optimise payments,” concludes Erik Breugelmans. "As a bank, we need to finance our customers’ receivables as quickly and efficiently as possible, so that they have easier access to their working capital. In addition, because we have already gone through an entire process in terms of large-scale automation, we will be able to adapt quickly to the new rules. We can also draw on the expertise of the BNP Paribas Group, which is currently developing an e-invoicing solution for large companies."

Want to know more?

Listen to the episode on B2B e-invoicing :

• French version
• Dutch version 

Biogazelle is playing a huge role in the shared battle against the coronavirus. In record time, the Ghent biotech company has developed a test for detecting infections.

Since 2007, Biogazelle has offered support to the pharmaceutical and medical industries. The company develops revolutionary techniques for tasks such as detecting new illnesses, multiplying tiny amounts of genetic material to create analysable samples.

“In just 10 days, we have come up with an extremely sensitive coronavirus detection test,” says CEO Mieke Van Acker. “Our speed and flexibility have amazed the big pharma companies. We started with 2,000 tests a day, and that number has already shot up. But we are still a long way from our limit.”

Unprecedented collaboration

To drive capacity even further, Biogazelle has invested in a robot. “Very soon this will automate certain manual operations,” the CEO explains. “Inactivation of the virus is currently done manually. By automating this step in the process, we will significantly increase efficiency.”

Biogazelle is part of a coronavirus consortium established by minister Philippe De Backer that also includes three large pharma companies and a university. “We are joining forces to further increase the testing capacity in our country,” says Mieke Van Acker. “Such a collaboration is unprecedented.”

Every link is crucial

According to Van Acker, every link in the chain is equally important. “We ourselves are supported by Ghent University, UZ Gent and the Flemish Institute for Biotechnology. We have help from volunteers, and industry colleagues have also offered test apparatus.

But the financial support from BNP Paribas Fortis is as valuable as the scientific aspect.” This financial support consists of a credit line and leasing agreement. Biogazelle will also make use of BNP Paribas Fortis Factor, a series of solutions aimed at optimising work capital and the resulting financial needs.

Some causes are more important than the pursuit of EBITDA. Without trees there can be no biodiversity, and flora, fauna, soil, water and air are all affected. That is why WeForest is mobilising companies to plant forests.

Reforestation is neither a luxury nor a question for hippies. It is indispensable for the climate and biodiversity, the quality of our soil and water, as well as for food; it is thus vital for the future of all species.

The solutions, which remain under-recognised, are simply waiting to emerge. They are not technical, do not adhere to the logic of extraction and do not call on limited natural resources. They are tremendously effective, draw their inspiration from natural ecosystems and entail integrating trees into fields. See also the article The full potential of reforestation.

We have pinpointed two relevant non-governmental initiatives: Ecosia, a search engine launched by a start-up in Berlin, has attracted 7 billion users and plants one tree for every 45 searches made – the equivalent of some 27 million trees planted to this day; secondly, the non-profit organisation WeForest is utilising its expertise in this area, its basis in science and its business network to engage in sustainable reforestation. We went to meet Marie-Noëlle Keijzer, the founder of WeForest, to hear her story.

From carbon offsetting to corporate 'water footprints'

In the early days, WeForest was not convinced by carbon offsetting, which it regarded as too reductive. Yet it was a means to connect with its target audience: companies anxious to measure, reduce and then offset the carbon emissions that they are not able to avoid. Today, the objective of 'net positive emissions' has been set, which also aims to offset past emissions.

It is obvious that environmental concerns now extend beyond carbon alone. Many are beginning to examine their water footprint. A new vision is taking hold, which entails development aid via the promotion of reforestation. "Moving countries out of poverty and doing more than simply planting trees and leaving: this is how companies now wish to act in a socially responsible way", explains Marie-Noëlle Keijzer, CEO of WeForest.

Intervening on vegetation, carbon, water, air and employment

With the 270 corporate clients that have joined it since 2011, WeForest planted almost 17 million new trees and restored 13,000 hectares of land by the end of 2017, and aims to double these figures by 2020. It offers high-impact marketing materials to customer companies with messages such as 'one sale = one tree planted'. 

In 2014, Brabantia decided to 'do something different'. It wanted to sell products, of course, but also give thought to global issues. Working alongside WeForest, the company entered into a joint financing project supporting reforestation. "Since Brabantia began to state on its website, on YouTube and on its packaging that one tree would be planted for every rotary dryer sold, it has seen a 25% increase in sales every year", explains the head of WeForest, citing well-substantiated case studies with certified benchmarks: "We go beyond the theoretical", she continues. "There is total transparency, with every customer receiving a GPS map of the hectares they have funded. We then ensure the forest is protected, approve our customers' projects and help develop the socio-economic activity of the entire region by initiating alternative revenue sources which create employment."

A tree is more valuable in the ground than on it

WeForest is not engaged in helping Zambia in order to maintain its reliance on international aid, but to educate the hundreds of farmers who chopped down all of their trees in order to sell them for firewood. By bringing them together, the association demonstrates that they do not have to clear trees to sell forestry chips, and that by selectively collecting biomass, they can provide heat without cutting a tree down. WeForest trains women to work as nursery growers, giving them a job, an income and an identity. It also supplies beehives to farmers who have begun to produce honey as a new source of income. Bees have other positive effects too, since they pollinate flowers, plants and fruit crops, for example. "It's really simple", affirms Marie-Noëlle Keijzer. "If we kill bees and birds by using pesticides and insecticides, we are preventing nature from doing its work."

Trees provide a habitat for animals and natural fertiliser for plants

In regions of Brazil where tree coverage is 3%, leopards have completely died out. Agriculture has supplanted forests wherever the ground is level. WeForest cannot operate across the entirety of the country, which is much too large. But they have created green corridors, and life has begun again. Trees and plants have been restored, attracting birds and animals that use them to move around, eat and reproduce.

Trees are also a natural source of fertiliser: corn grows more quickly when it is close to trees. They provide shade and retain water in the soil.

There are trees and trees

Not all reforestation projects are equal. Some trees boost the food supply or increase soil nitrogen levels (such as the lucerne), whereas others are detrimental to diversity. For example, no animals will live in palm tree plantations where the soil is also full of chemicals. "We won't solve the problem if we do nothing to change the causes of deforestation: intensive agriculture for the purposes of producing meat, for example", says Marie-Noëlle Keijzer, firmly convinced. Solutions exist, but everyone needs to accept their share of responsibility.

Sources: BNP Paribas Fortis, WeForest