When you're freelance in Belgium, taxes can get very complicated. There's different taxes depending on your company form, how much money you make and more. Here, you'll find out:
Belgian taxes in general
How tax brackets work
What will be your net income as a freelancer after taxes and other costs
Taxes in Belgium in general
You need to know several basics before calculating your taxes as a freelancer in Belgium.
Net income: your taxes are not calculated based on your entire yearly income, but on your net income per year, just like your social security contributions are calculated. You'll read how to calculate your net income below.
Tax brackets: your net income is divided into brackets, each of which has a different tax rate. You'll discover the different rates below.
Your taxes are calculated on your income of the previous year. Meaning in 2020, you'll pay taxes (or get a tax benefit) on your income of 2019.
Additional taxes: your income taxes are not the only taxes you'll have to pay. In total you'll start by paying VAT on every invoice you send or receive, but you'll also pay city taxes, provincial taxes, municipal taxes…
Depending on company form: as a freelancer, you're most likely a sole proprietor. If you are, your business and you as a person are considered the same legal entity and you'll pay personal tax on your entire income. If you chose a company, you'll be submitted to company tax*.
Make sure to calculate your taxes and save the amount beforehand. it can be tempting to spend a bit too much when your receive your gross annual income on your own bank account, but make no mistake: a big part of that money is not yours.
Make sure to save your VAT and a realistic estimate of your taxes, preferably on a separate account you never touch. That way, you'll always be prepared.
*Calculating company tax is far more complex than calculating personal tax. you'll find the basics here, but please consult your accountant for more detailed information.
What will be my net income?
Before being able to see how much taxes you'll have to pay per bracket, you need to calculate your net income. As you've possibly already learned when calculating your social security contributions , your net income is not the same as your gross annual income:
Gross annual income
- Business expenses (costs)
- Paid social security contributions
- Possible contributions to supplementary pensions
- Possible losses carried forward
= Net taxable income
This net income will be the basis on which taxes for the self-employed in Belgium are calculated, as well as the taxes for private persons. Many sole proprietors try to make as many (relevant) costs as they can, since it lowers your net taxable income.
How tax brackets work
In Belgium, taxes as a freelancer (sole proprietor) as well as for private persons is calculated in accordance with tax brackets. Different tax rates apply depending on how much you make. These are the rates:
Max. tax amount
€0 – €12,990
€12,990 – €22,290
€22,290 – €39,660
Every part of your income will be taxed according to the relevant tax bracket. If you make €50,000, the first €12,990 will be taxed at a rate of 25% and so forth. Everything between €36,660 and €50,000 will be taxed at 50%.
Taxes for freelancers in Belgium - part time
If you're a part-time freelancer in Belgium, your taxes will be calculated on your entire annual income: the income from your employer + the income from your part time business.
For instance, if you make €20,000 a year from your day job and an additional €5,000 from your freelance business, you will be taxed on €25,000.
Taxes for freelancers in Belgium - full time
When you're a full time self-employed freelancer, the same logic applies to your annual income.
If you expect to earn over €25,000 per annum, consider starting a company instead of being a sole entrepreneur. You'll find out exactly how they are different here, but for now, it's important to know that you'll pay a lot less taxes if you make the switch.
Personal taxes in Belgium can cost you up to 50% of your net income, while company taxes are much lower at 33.99%. Make sure to talk to your accountant in time to discuss the possibilities.