All articles · 2025-11-25 · General
Budget Agreement 2025: what changes for professionals?
The federal government reached a new budget agreement yesterday morning. Although detailed texts have not yet been shared, we know the main…
By Jan Hermans, CEO & founder of Lyff.
1. VAT increase 2025: no increase from 21% to 22%
The question has been quite prominent in recent weeks: Will VAT in Belgium go to 22%? The agreement finally gives us certainty on this question: no, the standard rate of 21% remains unchanged.
What does change?
Some reduced VAT rates will go up, for example, for takeaway meals, sports, and recreation. Flying will also become more expensive, as will postal packages originating from non-European webshops.
2. Indexation 2026 and 2028: limitation for higher salaries
Here too, there was some confusion: will there be an index jump (indexsprong) in Belgium? And here too the answer is: “no.” There will be no general index jump, but there will be two index limitations for higher salaries in 2026 and 2028.
Specifically:
- Salaries below €4,000 gross retain full indexation.
- Benefits below €2,000 gross are fully protected.
- Higher salaries receive partial indexation.
This primarily affects employees and employers in higher salary brackets and has a real impact on future labor costs. This rule will affect a large part of the population, although, for example, younger employees and people with low pensions will remain unaffected.
3. Pension measures: changes to pension penalty (pensioenmalus) and first year of work
“Do periods of illness count towards my pension?” Under the new agreement: yes.
The most important updates:
- Periods of illness will count as years worked when calculating the pension penalty (pensioenmalus).
- Anyone starting their first job only in September will still have that full year count towards pension accrual. A minimum of 104 working days is sufficient in the first year of work. This is an extra motivation for graduates to immediately enter the labor market.
This corrects existing anomalies in the pension system and provides more clarity for employees.
4. Excises and energy taxation 2025–2026: gas, electricity, and fuels
A question that reappears every winter, but today carries significant consequences: Will energy become more expensive?
What the government decided:
- Excises on gas, petrol, diesel, and heating oil will gradually increase.
- Excises on electricity will decrease slightly, but less pronounced than the increase on gas.
In summary: electric driving and electric heating become relatively more attractive, fossil energy relatively more expensive. If your home is heated by gas, this will consequently lead to higher energy bills, although the precise impact is not yet clear today.
5. Taxes on capital, banks, and management companies
Here lies the biggest question regarding fiscal optimization and company structures. Online we see a massive increase in search terms such as: “Management company tax 2025”, “VVPR-bis change”, “securities tax (effectentaks) 0.3%”, “new banking sector tax Belgium”.
How does that work exactly?
Securities tax (Effectentaks)
- The securities tax (effectentaks) is doubled from 0.15% to 0.3% for those with more than 1 million euros in their account.
Bank tax & insurance tax
- A new bank tax will be introduced.
- The insurance tax will increase.
Although the exact details are still missing, it is clear to whom these new taxes will be passed on: the end-user.
Stricter supervision of management companies
The government is focusing on combating fraud and preventing abuse:
- Paying artificially low salaries to activate social benefits is explicitly targeted.
- The tax on profit distributions via management companies, such as VVPR-bis and liquidation reserves (liquidatiereserves), increases from 15% to 18%. We hope that the new texts will clearly define what a management company is, a piece of information we do not have today.
As the tax on profit distributions increases, alternative forms of distribution (such as share option plans) become strategically more interesting again. Learn more about this in our Academy.
Conclusion: what does the budget agreement mean for you?
These are the main lines that have already been confirmed today. Many technical details still need to be worked out in legal texts and circulars.
What is certain:
- No general VAT increase
- Targeted index limitation for higher salaries
- Adjustments in pension accrual
- Rising energy excises
- Higher taxes on capital, profit distributions, and the financial sector
As soon as the federal government releases more official details, we will publish a new update.
In the meantime, do you want to know what this specifically means for your situation, your salary policy, or your company? Make an appointment with one of our experts!
Anticipating the increase to 18% for profit distributions
The increase in the rate for VVPR-bis and liquidation reserves (liquidatiereserves) from 15% to 18% forces us to reconsider the timing of your cash planning. As I describe in my book Fiscal Shortcuts for management companies (Fiscale Shortcuts voor managementvennootschappen), a management company is a shoebox with taps. The government is now turning the profit distribution tap a little tighter. For an entrepreneur who annually distributes €100,000 profit after tax, this means an extra cost of €3,000 per year. That may seem manageable at first glance, but over a career of twenty years, we are talking about €60,000 in purchasing power that disappears.
It therefore becomes crucial not to focus solely on dividends. When the fiscal pressure on the 'exit' increases, internal financing within your Lyff. structure becomes more important. Instead of transferring cash to private as quickly as possible at 18%, you might consider allowing liquidities to generate returns longer within the company via a branch 6 structure (tak 6-structuur) or a DBI-bevek. This compensates for the higher final tax by allowing a larger gross amount to grow.
Alternative remuneration as a strategic shortcut
Now that the Budget Agreement focuses on tackling artificially low salaries and increasing the tax on profit distributions, share option plans and warrants are once again taking center stage. This is one of the most powerful shortcuts. Unlike dividends, which do not count towards your pension accrual, the benefit in kind (voordeel van alle aard) from a warrant plan can indeed strengthen your salary basis for the 80% rule. This is a win-win: you reduce the pressure on profit distribution and simultaneously increase your fiscal space for pension accrual.
A concrete example from practice: a manager who increases his salary via warrants instead of a classic bonus sees his net efficiency increase while his pension reserve at the IPT (Individuele Pensioentoezegging) grows faster. At Lyff. we always advise embedding these techniques in a clear salary policy. This offers protection during audits, as it demonstrates that your remuneration is market-conform and consistent, rather than a reactive attempt to avoid taxes.
Frequently Asked Questions
Should I immediately increase my salary now that management companies are in focus?
Not necessarily immediately, but thoughtfully. The tax authorities look at the 'normal' salary. Anyone paying themselves the absolute minimum (often around €45,000 to maintain the reduced rate) but taking huge dividends runs a greater risk. In my book, I advise staying within the Gaussian curve: not extremely low, but a defensible salary that fits your performance and pension goals. View our services around fiscal optimization for a tailor-made calculation.
Does the increase to 18% also apply to already accumulated reserves?
The legal texts still need to confirm this exactly, but generally, an increase applies to distributions from the effective date. If you already have a liquidation reserve (liquidatiereserve) that has passed the waiting period, it may be fiscally advantageous to distribute it before the rate change. This is a typical example of cash planning where timing determines your return. Read more about this in pension planning or asset protection (vermogensbescherming).
Would you like to know more about the specific mechanisms to protect your company against these changes? Then order the book Fiscal Shortcuts for management companies (Fiscale Shortcuts voor managementvennootschappen).