On 21 July 2025, the Belgian government reached a political accord known as the “Summer Agreement,” introducing significant changes to tax measures. These proposals are expected to be incorporated into draft legislation in the coming months.
WHY THIS MATTERS
The tax reform, aimed at making work and entrepreneurship more attractive, will come into effect in 2026 and reach full implementation by 2029, impacting individual taxpayers and businesses operating in Belgium.
Key Highlights
Personal Income Tax
- Increase in Tax-Free Amount: The basic tax-free threshold will gradually rise from €10,910 to €15,300 by 2029, with the first increase taking effect in 2026.
- Child Exemption: The tax-free amount for the first child will increase annually from €1,980 to €2,650 by 2029. Over time, the exemption will be harmonized across all children.
- Marital Quotient Reform: The gradual phase-out of the marital quotient (which allows partial income transfer to a non-working partner) may result in higher tax liabilities for married or legally cohabiting taxpayers.
- Social Security Contribution: The special social security contribution will be reformed and reduced, particularly benefiting single taxpayers.
Compensation and Benefits
- IT Sector: The copyright regime will be reinstated for IT professionals starting in 2026, offering favorable tax treatment.
- Meal Vouchers: The maximum value of meal vouchers will increase from €8 to €10.
- New Tax on Excess Benefits: Starting in 2026, a separate 7.5% tax will apply to benefits in kind exceeding 20% of annual gross salary for employees, aimed at curbing excessive non-cash compensation.
Management Companies
To discourage the use of management companies for tax optimization, the following measures are proposed:
- Minimum Director Remuneration: The threshold will increase from €45,000 to €50,000 (indexed). If not met, the company will not be able to benefit from the reduced corporate tax rate.
- Benefits in Kind: For company directors, benefits in kind will be capped at 20% of annual gross salary. Exceeding this limit will result in the loss of the reduced corporate tax rate (20%).
KPMG INSIGHTS
These changes present both opportunities and challenges for individuals and businesses. For tailored advice and strategic planning, please contact your KPMG adviser.
FOOTNOTE:
1 See “De Wever government concludes summer agreement with crucial socio-economic reforms”, (25 July 2025).
Contacts
Disclaimer
The information contained in this newsletter was submitted by the KPMG International member firm in Belgium.
GMS Flash Alert is a Global Mobility Services publication of the KPMG LLP Washington National Tax practice. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.
© 2025 KPMG Central Services, a Belgian Economic Interest Grouping ("ESV/GIE") and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.