Belgian VAT updates 2023

Belgium introduced important VAT changes for 2023 concerning reverse charge, late interest rate, period to keep documents and statute of limitation, among others. Some of these changes result from the new Law containing different tax and finance measures, approved on 10 November 2022.

Find below the major changes impacting VAT compliance in Belgium.

Reverse charge in construction services

From 1 January 2023, when a Belgian established company performs construction supplies on immovable property, reverse charge will always apply provided that the customer has a Belgian VAT number and submits periodic VAT returns.

• This domestic reverse charge does not apply in case the customer provides a Belgian VAT number but is not obliged to submit periodic VAT returns. However, if the customer has not informed the supplier whether or not he must submit VAT returns, the supplier must include a statement on the invoice indicating that the customer has a period of 1 month to contest the invoice in writing. Once this period is expired with no further clarification, then the customer is liable for the payment of the tax and any applicable penalty.
• Also, the current clarification has an important impact on foreign taxpayers: reverse charge in construction services applies also when the customer is a non-establish company VAT registered in Belgium, it is irrelevant if this is a direct registration or via a fiscal representative. In the past, it would only apply to these foreign companies when registered via a fiscal representative in Belgium. 

The invoices issued by the supplies must include the following statement: ‘Reverse charge. In the absence of a written dispute within a period of one month from the receipt of the invoice, the customer is deemed to acknowledge that he is a taxable person liable to submit periodic returns. If that condition is not fulfilled, the customer is liable for payment of the tax, interests and fines due in respect of that condition (new Art 20, §3 RD No 1)’. 

Also, from 01/01/2023, the amendment of art. 53 quarter, §1, paragraph 1 of the Belgian VAT Code will also come into force, where the customer is obliged to provide the supplier with his valid VAT number. 

Late interest rate

The interest rate applicable to late payments is calculated based on the base interest rate increased by 4 percentage points.

The late interest rate should be applied over the total of the taxes due every month, rounded down to the multiple closer to ten. The monthly rate is currently 0,8%. You can check here the official information from the tax authorities.

For 2023, the late interest rate is established at 4%. Therefore, the total late interest rate will be 8% for 2023 in Belgium.

Separately, the moratorium interest is calculated based on the late interest rate minus 2%.

Record keeping

The required period of record keeping is extended from seven to ten years.

Statute of limitations in some specific cases

The statute of limitations changes in two different scenarios:

• In case of fraud, the statute of limitations is increased from seven to ten years. This is the time period the tax administration has to investigate back concerning tax liabilities.
• In case of the absence of VAT return submission or late submission, the statute of limitations is extended from one year to four years – until the end of the fourth natural year following the year when the tax was due. In consequence, the period to impose penalties and interests is importantly increased.