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taxation.be

Friday
Mar 22nd
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Stock Options

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Written by Administrator Monday, 13 December 2004
Employee stock options are no longer reserved for the executive suite. They have become a widespread means for attracting, motivating and keeping employees. (More …)

Court Upholds Constitutionality of Antiavoidance Rule

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Written by Administrator Monday, 06 December 2004
Article 344, section 1 allows tax authorities to disregard the legal qualification, or structure, of a transaction if they can prove the parties have chosen that particular legal structure solely to avoid income tax. If that can be established, tax authorities can reclassify the transaction and assess the applicable tax. However, tax authorities must accept the original legal qualification if the taxpayers can prove it meets lawful financial or economic requirements.

The general antiavoidance rule also may be used when tax authorities can prove that parties have divided a single transaction into separate steps to create a certain income tax outcome. Tax authorities can disregard the separate steps and treat them as one operation (step transaction doctrine). (Read the article …)

Belgium Supports Tobin Tax

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Written by Administrator Monday, 29 November 2004
The Belgian parliament has approved a law introducing a tax on the exchange of foreign currency, bank notes, and coins. The Chamber of Representatives adopted the bill on July 15, and the Senate has not used its right to review it. The bill should be signed by King Albert II and published in the official gazette within a few weeks. Belgium will be the first country to introduce a Tobin tax, although under article 13, paragraph 3 of the law, the tax cannot enter into force until all member states of the European Economic and Monetary Union adopt similar legislation.

The Tobin tax is named for James Tobin (1918-2002), an economics professor who was awarded the Nobel Prize in 1981 for his analysis of financial markets and their relationship to government spending decisions, employment, production, and prices. He launched his proposal for a tax on foreign exchange transactions in 1972, with the goal of increasing the independence of monetary policy and reducing nominal exchange-rate volatility when capital flows freely across international borders. (More …)

My Own Boss

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Written by Administrator Sunday, 28 November 2004
Who has never dreamt of it; chucking it all in and becoming self employed. Now, where do you start if you have decided to work as a self employed ? (More …)

Inheritance Matters

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Written by Administrator Friday, 19 November 2004
How you can use a marriage contracts to change the inheritance rules. (More …)

Prosecutor Takes Aim at Tax Avoidance Schemes

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Written by Administrator Thursday, 11 November 2004
The Antwerp public prosecutor’s office on October 19 announced that it has started an investigation into a “cash company” tax avoidance scheme allegedly set up by the owner of Belgian electrical retailer Hugo Van Praag to avoid the payment of € 10.41 million in corporate income taxes.

A cash company construction involves a cash-rich company that has successfully sold its assets, but has acquired a considerable capital gains tax liability. Under Belgian law, CGT is part of the corporate income tax. (The tax rate recently was reduced to 33.99 percent, from 40.17 percent.) If the company reinvests the proceeds from the sale of its assets in other, qualifying assets, rollover relief is available for capital gains on the fixed tangible (and some intangible) assets that the company held for at least five years before the disposal.

Cash company constructions can be doubly attractive for companies with large taxable profits and few possibilities to set off deductions against their profits. By selling the business assets to a second company with (almost) the same name and the same management structure, they can create new tax deductions, because the second company can depreciate the purchase price of the business assets. And if the second company finances the purchase, it can also set off the interest against its taxable profits. (Read the article …)

The Success of the Gift tax in Flanders

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Written by Administrator Tuesday, 09 November 2004

The Flemish Tax Authorities have seen a significant increase in gift tax collected. In the first nine months of 2004 they received some € 82,5 million, twice as much as budgeted on the basis of last year's figures. The rates have dropped significantly and Members of Parliament are beginning to wonder if they have not opened Pandora's box. (More …)

Belgium Announces New Tax Measures for 2005

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Written by Administrator Monday, 25 October 2004
Belgian Prime Minister Guy Verhofstadt on October 12 gave his State of the Union address in the Chamber of Deputies, the lower house of the Parliament. Several new taxes to be introduced in 2005 are expected to yield substantial funds for the government coffers.

For the fifth consecutive year, the federal government has managed to balance the budget for 2005. However, a number of measures that were approved during the past few months will be postponed, resulting in a savings of € 130 million. The postponements should not endanger social measures to fight poverty or increase jobs, and an increase in pensions and benefits will proceed as planned, Verhofstadt said. The most important new fiscal measures are described in more detail in the article attached … .

Third-Quarter Numbers for Belgian Tax Amnesty Disappointing, Finance Minister Says

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Written by Administrator Monday, 25 October 2004
Belgian Finance Minister Didier Reynders said October 19 that the results of the tax amnesty instituted in January have been disappointing. Reynders was expecting tax revenue of €60 million to €70 million for the third quarter of the year, but the tax amnesty brought in only € 46.9 million for that period. The amnesty brought in € 17.5 million in tax payments during the first six months of the year. The amount of unclaimed income that has been regularized is approximately € 530 million.

In total, 87 percent of the taxpayers who opted for the tax amnesty preferred to pay a tax of 9 percent, rather than reinvesting their savings and reducing the rate to 6 percent. Only 10 percent of the taxpayers opted for the 6 percent rate, and approximately 3 percent fell somewhere in between.

During the third quarter, banks delivered 1,901 tax amnesty certificates, compared to 151 from stock exchange companies and 2 from insurance companies. Only 38 taxpayers opted to own up directly to tax authorities. The average amount of savings income regularized per taxpayer was € 254,914, but among taxpayers who dealt directly with tax authorities, the average was € 716,566 per taxpayer.

Reynders said he will meet with bank representatives to discuss how to resolve the backlog in processing caused by increased numbers of files. More information will be available around December 20, because the banks must make another payment by December 15.

Salary Split

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Written by Administrator Friday, 08 October 2004
One of the most popular tricks in the tax book: how to pay less tax by paying tax in several countries. It's not just that simple. (More …)

Tax Amnesty Falls Short of Expectations

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Written by Administrator Monday, 04 October 2004

Tax Amnesty Falls Short of Expectations

With just three months to go to the end of the year, Belgian Finance Minister Didier Reynders has lowered his expectations about the outcome of Belgium’s tax amnesty. When the tax amnesty was introduced in January, he anticipated a windfall of about € 850 million, but as of July, the amounts regularized totaled just over € 204 million. (More …)

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