VVPR-bis in case of partial payment of the capital of
a limited liability company: time is running out
October 2022 – As a result of the reform of company law, BVBAs, which were required to have a small share capital, were transformed into BVBAs without share capital. The VVPR-bis regime suddenly seemed to be open to the 'old' capital... This was not the legislator's intention.
The VVPR-bis scheme
The VVPR-bis scheme provides for a reduction in withholding tax on dividends in the event of a new cash contribution to your company, provided that you leave this capital there for a certain period of time. In other words, this is an incentive to strengthen your company's equity capital.
When this scheme was introduced in 2013, one of the conditions was that the share capital had to be fully paid up. A company that had not fully paid up its capital was therefore not eligible for the VVPR-bis rate.
However, the company law reform that came into force on 1 May 2019 abolished the capital requirement for all companies (except for public limited companies). BVBAs with a minimum share capital of EUR 18,550 have become BVBAs without capital.
The obligation to release does not disappear
The condition that the capital had to be fully paid up for VVPR-bis shares or units was not in itself removed. 18,550, whereas no minimum capital was required for a limited liability company: the VVPR-bis regime was therefore also possible for limited liability companies and even much easier.
But what about the many limited liability companies whose share capital had not been fully paid up? These companies have become, and are becoming, by force of law, limited liability companies, but their share capital remains the same and their obligation to pay up also remains, since these two elements are included in their articles of association.
How to get around this problem?
When a limited liability company was converted into a limited liability company, the payment obligation of the founders was lifted and the share capital of the limited liability company was reduced.
From then on, the first euro of a new contribution qualified as new shares with VVPR-bis status.
Adaptation early 2022
A law of 21 January 2022, however, put an end to this construction. Not only for the future, but also for the past.
The law now stipulates that the obligation to pay up applies not only to the existing capital, but also to the capital originally subscribed. A waiver of the requirement to pay up capital, combined with a reduction in capital, therefore no longer has any effect.
Transitional regime
Companies that had already set up the above-mentioned construction also fall under the new regulations. This means that in these cases the reduced rate of withholding tax cannot be applied.
The law of 21 January 2022 has nevertheless provided for a regularisation period.
Companies that have granted an exemption from paying up the VVPR-bis shares subscribed between 1 May 2019 and 15 December 2021 may regularise their situation by carrying out a capital increase in cash before 31 December 2022. This contribution must have the effect of increasing the amount of capital paid up in cash to the amount initially subscribed before the exemption from payment. In other words, the company must still pay up the capital in full before 31 December 2022.
The date of 15 December 2021 was not chosen at random. The measure was made public more or less at that time. A company that has reduced its share capital after 15 December 2021 while granting an exemption from paying up the capital can therefore no longer rectify the situation.
31 December 2022
You will not be able to rectify the situation after 31 December 2022, and the VVPR-bis shares or units concerned will lose their benefits for good. It is therefore important to take the necessary steps in good time.
