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An excellent business environment

Belgium is undoubtedly one of the most attractive European countries for doing business, as it has become the economic and urban nerve centre of the European Community. Belgium has two strategic locations from which the whole of the EU can be accessed - Brussels, the de facto capital of Europe; and the City of Antwerp, home to the continent's second-largest port. As a result, a breathtaking assortment of international companies, institutions and service providers has established global, regional or head-offices in this country at the heart of Europe. Today, Belgium belongs to the best jurisdictions for holding and finance companies.

But Belgium is keen to attract not only large corporations, but also small- and medium-sized enterprises as well as private entrepreneurs. Through its Belgian office in the City of Antwerp, Henley & Partners assists foreign corporations and investors in doing business and establishing operations in Belgium, as well providing them with ongoing legal, administrative and support services.

Company types in Belgium

When establishing a new business or subsidiary in Belgium, you may opt for a separate legal entity — whether in the form of a private limited company or a public limited corporation — or you might choose to establish a branch office.

Business and corporate taxation

The corporate taxation system (supported by a treaty network with over 80 countries in order to avoid double taxation) has recently been revised to fall in line with the country's reputation as Europe's favourite holdings country. Doing business in Belgium has now become even more attractive, with benefits like being the only country to allow deductions for risk capital - known as deemed "Notional" Interest - a new ruling process, and the only EU member to have a tax treaty with Hong Kong, the gateway to Asia.

Business and the unique Notional Interest Deduction

All companies subject to Belgian corporate tax are allowed to deduct from their taxable income a percentage of interest on their adjusted equity (including retained earnings), to diminish the discrimination between equity and debt financing. It has been set at 3,442% for the 2006 fiscal year. Small- and medium-sized companies may even apply an additional 0,5% deduction. Depending on the amount of equity, corporate taxation might even end up at 0%.

Business and a new tax ruling process

A new central ruling commission is offering Corporate Belgium the opportunity to clear today "any" potential tax issues with respect to transfer pricing, taxable presence, restructuring, participation, VAT, customs and even personal tax, that might arise in the years to come. The average time-frame for the process is 3 months. Pre-filing meetings (anonymous, should you wish) to avoid delay are one of the many new Belgian business-support facilities.

The Belgium/Hong Kong tax treaty — the EU/Asia gateway

Being the only EU country to have a tax treaty with Hong Kong creates unique opportunities for both Asia-EU and EU-Asia investments - with Belgium as a key financial portal. Belgium has extended its role as the main EU holdings country by making the EU parent-subsidiary WHT exemption accessible to Asian investors, as the treaty allows WHT-free dividend repatriation from Belgium, where 95% of dividend income from other EU subsidiaries will be tax-exempt.

Some of the many advantages of doing business in Belgium include:

For more details on corporate taxation please click here.

To establish yourself or your business in Belgium will require securing relationships with key partners, such as government officials, bankers and corporate professionals. You need experienced consultants to build a network of contacts and help you to become established in your new environment.

The specialised services of Henley & Partners are a resource and complement to other consulting and law firms. We can help other firms and their clients with the unique and specific details required by the business relocation and immigration process and related tax planning.

To find out more about the possibilities Belgium offers you, contact Henley & Partners. Through our Antwerp office, we are well positioned to advise and assist you with all matters regarding Belgium.