For the first time, a Belgian court has ruled on the question whether an outbound transfer of seat of a Belgian company could trigger a dividend (withholding) tax at the level of its shareholders. It is quite a controversial topic, as the Ruling Commission (no tax) and the central tax authorities (dividend tax is due) take opposite views.
The Court of first instance of Walloon Brabant has decided that no dividend withholding tax was due upon the transfer of seat of a Belgian company to France. This is obviously good news for Belgian companies which are currently contemplating an emigration, and for their shareholders (especially individuals, who are not eligible for a withholding tax exemption). The Belgian State has appealed against this decision.
The reasoning of the court could in my view be transposed to an outbound transfer of the effective place of management (siège réel) while the statutory seat remains in Belgium (e.g., a Belgian company transfers its place of effective management to Germany, while maintaining its legal/statutory seat in Belgium).
In such cross-border restructurings, the potential application of the general anti-abuse rule (GAAR, laid down in Art. 344,§1 BITC) remains a point of attention. “Agressive” transfer of seats, which are for instance followed by a quick liquidation of the company in the host State (e.g., during the same accounting year, or during the year that follows the transfer) should be closely monitored. The Belgian tax authorities could indeed, in certain cases, try to claim Belgian withholding tax at the rate of 30% (especially if the shareholders are individuals) based on the GAAR.
See also l’ interview in the economic newspaper L’Echo.
