4 November 2022

In October 2022, the Federal Preliminary Agreement shares future plans that will impact, among other things, the tax-advantaged treatment of authors’ rights. It provides insight into the future of this tax support measure, its implementation, and the impact on taxes payable within certain sectors. So far, these notions have not been translated into a concrete reform. It could make the Belgian innovation landscape a lot less attractive. 

What are copyrights?  

If a taxpayer receives income from the transfer or concession of copyright and related rights, these are in principle taxable as movable income.  

  • The movable income tax rate is lower than the professional income tax rate, so the employee receives a lower tax rate  
  • This is a means of increasing the attractiveness of your business  

Authors’ rights is an income that can be broadly interpreted. As a result, several sectors can get a tax advantage from this, think IT, consultancy and more. It is here that Belgium is the perfect location for innovation because it encourages it. 

Who is eligible for this tax measure?  

In general, Belgian private companies and public institutions can benefit from various tax incentives and schemes. These affect both your taxable income and your tax return.   

  • Any company with eligible employees (degree and activity)  
  • Payment of professional income tax in Belgium  

But in 2008, authors’ rights were for the creation of a work. The scheme can legally be interpreted broadly, allowing various sectors such as media, consultancy, IT, arts, … to pay their staff or themselves partly in authors’ rights. As a result, a whole range of companies are eligible for this tax measure. 

What changes are on the agenda?  

The federal government wants a stricter cap on copyright and its application in Belgium. The preliminary agreement indicates that the regime could be adjusted:  

  • Artists, literary artists and people who transfer a work protected by copyright to a third party for communication to the public or for public performance will continue to be covered by copyright.  
  • For game designers, whether they meet the definition will be assessed on a case-by-case basis.  
  • A transition period of one year will be provided for those who can no longer benefit from the regime.  

The tax authorities consider copyright income as movable income on which only 15% withholding tax has to be paid. Moreover, for the lowest income bracket, 50% flat-rate costs may be deducted.  

One-year transition period  

For the companies that can no longer benefit from the regime, there is a one-year transition period, namely the calendar year 2023.  

The proposal would be that all companies using the regime in calendar year 2022 could still do so for half in 2023.   

  • 2022: all income below €64,070 is eligible for treatment as movable income  
  • 2023: all income below half that amount, taking indexation into account, will only be eligible.    

FI Group is closely monitoring the decisions and will stay abreast of any changes that may affect the tax measure, its interpretation and application.  

FI Group has 20 years of experience and wants to support you in understanding and exploiting the available R&D+I opportunities. Our experts are at your disposal to analyse your project and take the next steps together with you towards innovation.  

Yvette Poumpalova

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