Taxation of a property company (SCI) in Belgian rental
Detailed taxation of a property company (SRL) in Belgium. Corporate tax, depreciation, dividends, capital gains, and comparison with personal ownership.
- 01 SCI tax regime
- 02 Tax advantages
- 03 Disadvantages
- 04 When to use an SCI
SCI tax regime in Belgium
An SCI (real estate company) in Belgium is generally subject to corporate tax (ISOC) at 25% on its profits. The taxable base is the actual rent received minus all deductible costs (depreciation, interest, property tax, insurance, maintenance, management).
Tax advantages
Full cost deductibility (including depreciation at 3%/year), lower base tax rate (25% vs up to 50% marginal rate for individuals), estate planning possibilities (donation of shares instead of property), and no registration duties on share transfers.
Disadvantages
Structure costs (accounting, filings, publication: approximately 2,500 EUR/year), double taxation on dividends (25% corporate tax + 30% withholding on distributions), no capital gains exemption after 5 years, and higher notary fees at purchase (no reduced registration duties for companies).
When to use an SCI
An SCI is justified from 3+ properties, high personal income (marginal rate above 45%), long-term holding strategy (no resale planned), and estate planning needs. For 1-2 properties, individual ownership is almost always preferable. Consult our complete SCI guide and our rental taxation guide.
Frequently asked questions
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The standard corporate tax rate is 25%. Small companies (specific conditions) benefit from a reduced rate of 20% on the first EUR 100,000 of profit. This rate applies to the actual rent less all deductible charges.
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Yes. The withholding tax on dividends is 30%. The total taxation (corporate tax + dividend) reaches an effective 47.5%: EUR 100 profit -> EUR 75 after corporate tax -> EUR 52.50 after dividend. This is the major disadvantage of a company.
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Yes, if it meets the 'small company' conditions: at least one director with minimum remuneration of EUR 45,000/year, no participation of more than 50% in another company, and other criteria. For a pure property holding company, the remuneration condition is often the blocking factor.