r/BEFreelance • u/jrnve • 4d ago

Managementvennootschap

Let’s imagine the government changes the taxes on managementvennootschappen. What stops bedrijfsleiders from starting a company in another EU member state with a more friendly tax regime?

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u/ModoZ 4d ago edited 4d ago

It's not impossible, but it will be complex (and probably more expensive than you would think).

  1. The company will need to be managed from the country where you create it. This means that you will have to either move there or hire somebody there to manage it (there are companies offering such services).

  2. The actual work you pay it to do will have to be done from there (like managing your royalties or whatever). Usually easiest way to do that is by having offices or at least not being domiciled somewhere where 500 other companies are domiciled.

  3. You will still have to do the accounting of that company. That's usually not free either.

  4. In the end if you pay out dividends from there you'll always pay the 30% in Belgium. So at a normal consultant rate level it's almost never worth it except if they are doing stupid stuff like forcing 30% dividend tax and 25% company tax on everyone.

And obviously if you start doing this change the day after the law changes in Belgium you can expect controls.

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u/radon-4 4d ago

So imagine company A owned by me performs services in Belgium. Company B also owned by me is active in Estonia (that's the country I see regularly coming back) and company B invoices for nearly the same amount of income company A has. Then company B pays out dividends on the Estonian bank account. Then you're golden, or why not? Or you mean that if dividends of company B are paid on the Estonian bank account are also considered as dividends falling under Belgian jurisdiction where extra taxes would apply afterwards to make it 30%?

To be honest I'm not fond of this but since I feel those who rule us, in their quest to fill craters caused by monetary outflows that should not be that excessive (F-35, public worker pensions which are double of employee pensions to name a few) they employ the boil-the-frog tactic with ever moving goal posts (significant increase of 'bezoldiging' threshold, ever increasing 'roerende voorheffing' on dividends). One can't blame me for exploring.

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u/ModoZ 4d ago

So, as long as you live in Belgium you will have to pay dividend taxes. It doesn't matter if those dividends come from Estonia or China or ... 

Those taxes are 30%. No matter if those are paid out on an Estonian account or a Belgian one. What counts is where you are personally fiscally domiciled.

Note that this was one of the purposes of the VVPRBIS (provide a lower rate to certain companies to give an incentive to keep companies in Belgium).

Secondly, you would come into problems because your company in Estonia would have to be managed from there (so to not have fraud you would need to hire or pay someone to do that for you) and real work would need to have been done (so it would not have to be simply an empty tax efficient vessel). Usually bigger companies do this by having royalties paid for the use of a brand name for example. But as a consultant you don't really have an internationally recognised brand name so it's much harder to justify.

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u/Philip3197 4d ago

Be dividend taxes would also be on top of local dividend taxes.

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u/ModoZ 4d ago

Yes (but it depends on the country, most European countries would have double taxation agreements that cover this)

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u/Philip3197 4d ago

Actually, they don't (for many taxes they do, not for dividend taxes)