Belgium remains one of the countries with the highest tax burden on labor. To remain attractive to foreign employees, a favorable tax regime for expats has been in place for quite some time.
However, a new statutory expat regime has been in effect since 2022. Although this system initially seemed less attractive than the former administrative regime, a recent legislative amendment and an additional administrative circular have made it more appealing once again.
The new expat regime
The Program Law of December 27, 2021, replaced the former administrative expat system with a statutory framework. Thanks to a transitional arrangement, both systems were able to coexist until the end of 2023. Since January 1, 2024, only the new regime has been in effect.
The current system distinguishes between:
- the special tax regime for incoming taxpayers (BBIB), and
- the special tax regime for incoming researchers (BBIO).
Both regimes apply to incoming taxpayers and researchers who have started working in Belgium since January 1, 2022.
Although the new regime offers greater legal certainty, it was less favorable than the old system in certain respects. This was primarily due to:
- the introduction of a minimum remuneration threshold for the BBIB, and
- the limitation on employer-specific expenses that could be added to the remuneration.
Relaxations to the expat regime
As part of the Easter Agreement, the regime was relaxed through the Act of December 18, 2025.
These changes were introduced after the business community and international employers criticized the limited attractiveness of the new regime. With this reform, the legislature aims to make Belgium more competitive again in attracting foreign talent and international expertise.
Reduction of the minimum gross taxable income threshold for the BBIB
To qualify for the BBIB, an employee or executive originally had to receive an annual gross taxable income of more than 75,000 EUR for work performed in Belgium.
That threshold has now been lowered to 70,000 EUR. In addition, it has been stipulated that this amount may be adjusted every three years based on the smoothed health index.
When calculating this remuneration, the gross annual salary before deduction of social security contributions is taken into account. Certain payments are excluded from this calculation, such as severance pay, compensation for temporary loss of wages, and exempt remuneration under Article 38 of the WIB92. Bonuses for which there is no certainty at the time of applying for the BIBB system may also not be included.
It is important to note that the wage threshold is assessed solely on the basis of work actually performed in Belgium. For employees with a split payroll, therefore, only the Belgian portion of the compensation counts.
This minimum wage requirement does not apply to the BBIO. For the BBIO, a degree requirement is sufficient. Furthermore, the BBIO is available only to employees and not to company executives.
Higher flat-rate expense allowance and removal of the cap
A key advantage of both the BBIB and the BBIO is that the employer can grant a tax-free and social security contribution-free flat-rate expense allowance of 35% on top of the salary. Until recently, this allowance was capped at 30% of the gross salary, with an absolute ceiling of 90,000 EUR per year.
This allowance is considered reimbursement for expenses specific to the employer and may include, among other things:
- one-time moving expenses;
- expenses for furnishing a residence in Belgium;
- school expenses for children; and
- other recurring expenses directly resulting from employment in Belgium.
Administrative clarifications on the expat regime
On April 1, 2026, the tax administration published Circular 2026/C/51 with additional explanations regarding the new relaxations.
Among other things, the circular confirms that:
- the minimum remuneration of 70,000 EUR, effective January 1, 2025, must be calculated on a pro rata basis in the year of arrival, departure, or termination of the regime, depending on the number of days during which the conditions of the regime were met;
- the abolition of the 90,000 EUR ceiling automatically means that the pro-rata allocation based on that ceiling is also eliminated. Thus, it no longer applies to the recurring costs specific to the employer, both under the BBIB and the BBIO.
The circular also clarifies that the changes apply retroactively to compensation paid or granted on or after January 1, 2025.
A distinction is made between two situations.
On the one hand, incoming taxpayers and researchers who were already covered by the expat regime prior to the Act of December 18, 2025, may take advantage of the new tax limits as of January 1, 2025. Where applicable, existing employment contracts may still be amended retroactively until no later than June 30, 2026, in order to:
- for BBIB: apply the lower minimum remuneration of 70,000 EUR,
- for BBIB & BBIO: increase the flat-rate expense allowance to 35% with no cap.
On the other hand, the Act of December 18, 2025, provides for the retroactive submission of an application for the application of the BBIB for new hires.
Taxpayers who began employment in Belgium between January 1, 2025, and January 9, 2026, were exceptionally permitted to submit an application for the expat regime until April 9, 2026. This constituted a deviation from the normal application deadline of three months after the start of employment.
Conclusion
With these changes, the Belgian expat regime has once again become significantly more attractive, both for the companies involved and for employees.
LexQuire can provide appropriate legal guidance to identify and implement the relevant adjustments. Please feel free to contact one of our specialists.
