The new Programme Law: what will change for your business?
August 2025 - On 10 July 2025, the House of Representatives approved the long-awaited Programme Law. This brings into force various tax measures that could have significant consequences for you as an SME entrepreneur. From new VAT rules for reconstruction to stricter dividend conditions: here is an overview of the most important changes.
6% VAT for demolition and reconstruction relaxed again
There is good news for property developers and builders: the reduced VAT rate of 6% on the sale of homes after demolition and reconstruction is once again becoming more accessible.
Until now, this scheme only applied to projects for which the environmental permit was applied for before 1 July 2023, and that until 30 June 2025 at the latest. Since 1 July 2025, the 6% rate has once again been structurally applicable, regardless of the date of application for the permit. The conditions:
The buyer uses the property as their sole residence, with a habitable surface area of no more than 175 m²;
Or the property is rented out as social housing;
Or the property is rented out on a long-term basis to a private individual, again with a habitable surface area of no more than 175 m².
Although the law will only come into force upon publication in the Belgian Official Gazette, the Minister of Finance has announced a tolerance: invoices from 1 July 2025 may already be issued at 6% VAT, provided that the sales deed contains the correct information. The required declaration 111/3 will be available digitally via MyMinfin at a later date.
New rules for dividends: impact on small companies
Small companies will be affected by changes in the taxation of dividends.
a. Liquidation reserves
Until now, SMEs could set up a liquidation reserve with 10% anticipatory tax and pay it out after five years with only 5% withholding tax, resulting in a total tax rate of 13.64%.
What is new:
The waiting period is reduced to three years;
The withholding tax increases to 6.5%;
The total tax rate is now 15%, in line with the VVPRbis regime.
For existing reserves, entrepreneurs can choose between a 6.5% levy after three years or a 5% levy after five years. Please note: the FIFO principle (“First In, First Out”) remains in force. In other words, anyone wishing to pay out older reserves must do so chronologically.
b. VVPRbis remains unchanged
Dividends from shares acquired since 1 July 2013 through a cash contribution continue to benefit from a reduced rate of 15% withholding tax from the third financial year onwards, subject to certain conditions.
Stricter DBI conditions for large companies
The DBI deduction ensures that dividends between companies are not double taxed. Nothing changes for small companies.
For large companies (those exceeding two of the following thresholds: 50 employees, 11.25 million euro turnover or 6 million euro balance sheet total), there will be a significant change: from now on, they will only be able to benefit from the DBI deduction if their participation qualifies as a “financial fixed asset”.
This rule also applies to capital gains on shares and will take effect from the 2026 tax year.
Other tax changes
a. Carried interest as movable income: fees for fund managers, known as ‘carried interest’, will now be taxed as movable income at the standard rate of 30%.
b. Exit tax on company emigration: when a company moves its registered office abroad, this is treated as a liquidation for tax purposes. This means that both the company and its shareholders are taxed on a notional dividend.
c. No tax increase for first offence: if you, as a company or private individual, make an honest mistake during a tax audit for the first time, you will no longer be faced with a 10% tax increase.
d. Fifth regularisation round: since 1 January 2024, tax regularisation has no longer been possible, but a fifth procedure (“EBA quinquies”) is now being introduced. The rates are 30% above the normal tax rate, or 45% for time-barred capital.
Time for a tax check-up
The approval of the Programme Law means a changed tax reality for many SMEs. It is therefore worthwhile to sit down with your bookkeeper or accountant now, so that you can respond optimally to these new rules.
