NEW IN 2018: Tax exemption for the compensation for nuisance granted to self-employed persons and SMEs
As a result of the sixth state reform, the Belgian regions have become competent for granting the so-called ‘compensation for nuisance’. This compensatory payment can be granted to self-employed persons and SMEs suffering from nuisance further to works in the public domain.
On the basis of the law laying down certain tax provisions I, such regional payments which already existed in Flanders, will be exempted from taxation for self-employed persons as well as companies as from 2018. This involves both compensatory payments granted in accordance with the existing law of 3 December 2005 and compensations granted pursuant to new regional regulation.
The said tax exemption is applicable to compensatory payments paid or granted as from 1 January 2018. This exemption will be granted for payments made with a view to compensating a decrease in the professional activity as well as a cessation of that activity.
An additional advantage of this measure is that, when determining the height of the compensation, the Belgian regions can now neglect the calculation of the tax that was going to be levied on that compensation . This implies the abolition of additional costs to be paid by the Belgian regions.
Minister of Finance, Johan Van Overtveldt: “The compensation for nuisance will be exempted from taxes, both for self-employed persons and for SMEs. Our aim is to support the measures taken by the Belgian regions, which intention is to grant an extra compensation to entrepreneurs who are inconvenienced by public works."