Llyd Gergelaan 11 I 1000 Brussels www.berquinntaries.be Dnating real estate cheaper in Flanders Eric Spruyt, ntary, prf. KU Leuven and Fiscale Hgeschl March 2016 The cst f dnating prperty in Flanders has been drastically reduced. Thse wh carry ut energy-saving renvatin wrk pay even less. Since 1 January 2015, the registratin and successin duties have been laid dwn in a new tax cde, the Flemish Tax Cde. Successin duties (successierechten) are nw called inheritance tax (erfbelasting) and gift duties (schenkingsrechten) have been renamed gift tax (schenkbelasting). Far mre imprtant, hwever, is that since 1 July 2015, dnating real estate has becme far cheaper. The residence f the dnr cunts! The Flemish gift tax and its reduced rates fr the dnatin f real estate (huses, land, apartments) nly apply if the dnatin is lcated in the Flemish Regin. The nly criterin cnsidered is the tax residence f the dnr, at least when this persn is an inhabitant f Belgium. The lcatin f the dnated prperty plays n rle. If yu live in Antwerp and yu dnate a huse in the Ardennes, yu can d this at Flemish rates. There are three exceptins t this principle: 1. Yu have mved frequently. If yu, as a dr, have lived in varius regins in the past five years, then the place where yu lived lngest cunts.
2. Yu live abrad. Then the lcatin f the real estate cunts. If yu went t live in Spain when yu retired and yu want t dnate yur apartment in Liège t yur sn, then Walln gift duties will be levied. 3. Yu dnate a building n which energy-saving renvatin wrk is then carried ut. In this case, the rate will be even lwer (see belw), but the prperty must be in the Flemish Regin (i.e. dnr and prperty in Flanders). What is new? - Fewer categries: there are nw nly tw categries: rates fr dnatins in the direct line/between partners (married cuples, legally chabiting partners and actually c-habiting partners wh have lived tgether fr ne year withut interruptin) rates fr dnatins between all ther persns (see table) - Fewer brackets - Lwer rates: in the direct line/between partners: in the lwest bracket yu still pay 3 %, but up t a bracket f 150,000 (previusly up t 12,500) between ther persns: a rate f 10 % up t 150,000 (previusly 20.25 r 30 % up t 12,500) and the highest rate is nw 40 % (previusly up t 80 % fr utsiders ) Figures that appeal t the imaginatin Single persn dnates in the direct line Anja dnates an apartment in Ghent (value 250,000) t her sn Bart. Gift tax payable previusly: 26,625 Gift tax payable since 1/7/2015: 13,500 A reductin f 13,125 Brther dnates t sister Karel dnates a residence lcated in Anderlecht (value 250,000) t his sister. Gift tax payable previusly: 121,875 Gift tax payable since 1/7/2015: 35,000 A reductin f 86,875
Sugar aunt dnates t nephews Lies dnates a rented apartment building cnsisting f tw apartments, lcated in Krtrijk (value 500,000) t her tw nephews, half each in indivisible wnership. She retains usufruct, the nephews nly receive bare wnership. The gift tax is calculated n the basis f tw dnatins, each f 250,000. The gift tax is calculated n the value in full wnership f the dnated prperty. Dnatin frm aunt Lies t nephew A: gift tax payable since 1/7/2015: 35,000 Dnatin frm aunt Lies t nephew B: idem: 35,000 Ttal gift tax payable since 1/7/2015: 70,000 Gift tax payable previusly: 268,750 A reductin f 198,750 Additin reductin fr energy renvatin and rental f gd-quality husing In additin t the general rate reductin, the Flemish gvernment ffers tw tax incentives: - ne in the event f energy-saving renvatin f the dnated real estate - ne in the event f the rental f high-quality husing. In each case, this is a deferred reductin. Initially, yu pay the usual (reduced) rate n the dnatin f the real estate. When it later appears that yu fulfil the renvatin/rental cnditins, yu can btain an additinal reductin and the tax authrities refund the difference. Cnditins: - The dnated prperty is lcated in the Flemish Regin. Fr the additinal reductin upn rental, it must be husing; fr the energy renvatin this is nt required. - The persn wh receives it must have renvatin wrk wrth at least 10,000, excluding VAT, carried ut within five years f the date f the fficial deed f dnatin (e.g. a heat pump, slar biler, etc) r btain a certificate f cnfrmity and cnclude a registered lease fr at least nine years within three years. And this perid f nine years must actually be achieved, therwise the tax authrities can reclaim the refunded gift tax! - Fr renvatin: the wrk must be inviced by a cntractr wh issues a certificate shwing that the invices actually related t ne f the eligible types f wrk. - Yur applicatin fr reimbursement must be with the tax authrities at the latest within six mnths after the end f the 5-year/3-year perid. (In the case f renvatin, yu als include the invices, with rental yu include the certificate f cnfrmity and the lease).
Hwever, yu d nt have t wait three r five years. As sn as the wrk is dne r as sn as yu have been able t rent ut the dnated prperty with a certificate f cnfrmity, yu can request the refund. Exemptin fr disabled persns Fr inheritance tax, there is an exemptin fr disabled children. This is nw als applied if yu dnate t a disabled child/persn. This is an allwance r threshld exemptin, a reductin f the taxable base. The amunt f the exemptin depends n the degree f relatinship between the dnr and the disabled persn. Hw des it wrk? - In the event f a dnatin t a disabled child/persn in the direct line r between partners, the allwance is equal t the sum btained by applying the fllwing frmula: ( 3000) x age cefficient (depending n the age f the recipient f the dnatin). - Fr dnatins between all ther persns, the allwance is equal t the sum btained as fllws: ( 1000) x age cefficient. Appendix: new reduced Flemish basic rates (since 1 July 2015) TABLE I in the direct line and between partners prtin f the dnatin A bracket in rate applicable t the crrespnding prtin in clumn A, in % ttal amunt f the tax n the previus prtins, in Frm up t and including 0.01 150,000 3-150,000.01 250,000 9 (6 with renvatin/rental) 4,500 250,000.01 450,000 18 (12 with renvatin/rental) 13,500 (10,500) 450,000.01 27 (18 with renvatin /rental) 49,500 (34,500)
TABLE II Rate between all ther persns prtin f the dnatin A bracket in rate applicable t the crrespnding prtin in clumn A, in % ttal amunt f the tax n the previus prtins, in Frm up t and including 0.01 150,000 10 (9 with renvatin/rental) - 150,000.01 250,000 20 (17 with renvatin/rental) 15,000 (13,500) 250,000.01 450,000 30 (24 with renvatin/rental) 35,000 (30,000) 450,000.01 40 (31 with renvatin/rental) 95,000 (78,500) ******************** Nte: wuld yu like mre cncrete infrmatin after reading this text? Unfrtunately Berquin Ntarissen cvba is unable t advise yu by email. If yu wish, yu can phne t make an appintment with ne f ur lawyers r ntaries.