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Belgium-Luxembourg Double Tax Treaty

Belgium-Luxembourg Double Tax Treaty

The avoidance of double taxation

double tax treaty between Belgium and Luxembourg protects investors in both countries from double taxation on income. The Convention for the avoidance of double taxation applies to residents of both countries and contributes to a better collaboration between the two jurisdictions and also serves in the fight against tax evasion.

Our law firm in Belgium offers professional tax consultancy services and can tell you more about how these double tax treaties influence your business if you are a foreign investor in Belgium. 

Taxes covered by the Luxembourg-Belgium treaty

The main taxes covered by the double tax treaty between Belgium and Luxembourg are those on income and on capital: all taxes imposed on total income, on total capital or on elements of income and capital. This also includes taxes levied on employers for the wages or salaries paid to their employees in Belgium or in Luxembourg. 

The taxes for which the Convention applies in case of Belgium are:

– the individual income tax;

– the company tax;

– the income tax for legal entities;

– the income tax for non-residents.

In the case of Luxembourg the taxes covered by the treaty are:

– the individual income tax;

– the company tax;

– the tax on the company directors’ fees;

– the capital tax;

– the municipal trade tax and the municipal payroll tax;

– the land tax.

The double tax treaty also applies to any similar or identical taxes levied in place of or in addition to the ones listed above. The tax authorities of the two countries must notify one another if any changes occur in their taxation laws. 

If you are an individual who derives income from both countries, the experts at our Belgian law firm can tell you more about how this treaty affects you.

Other treaty provisions

The double tax treaty between Belgium and Luxembourg also sets preferential withholding tax rates for dividends, royalties or capital gains. The tax rate is reduced under the treaty and under several other conditions. The provisions of this bilateral agreement are beneficial for branches in Belgium or Luxembourg.

For more detailed information about taxation in Belgium, including the corporate tax and the personal income tax you can contact our law firm in Belgium.

Our experts are also able to help you with other tax issues, including tax minimization or general company management.