Master Business Expense Compliance in Belgium

In particular, Belgian tax authorities regulate the following with regards to business expenses:

• VAT rates
• Daily allowances / per diems
• Vehicle allowances / mileages
• E-archiving of receipts

VAT rates in Belgium

In Belgium, the applicable VAT rates range from 0% to 21%.

0% VAT rate

The 0% VAT rate is applicable to some newspapers as well as certain recycled materials and by-products. It also applies to intra-community and international transport (excluding rail, road and inland waterways).

6% reduced VAT rate

The reduced 6% VAT rate applies to what are generally considered “essentials” such as most foodstuffs (including takeaway), water, some pharmaceuticals, domestic passenger transport, books, hotel accommodation and more.

12% reduced VAT rate

The 12% reduced VAT rate applies to certain foodstuffs, agricultural supplies, social housing, restaurants (excl. beverages) and energy products.

21% VAT rate

All goods and services that do not qualify for another rate or exemption are subject to a VAT rate of 21% in Belgium.

Daily allowances (per diems)

Employees travelling in Belgium and abroad are entitled to daily allowances or per diems. These are meant to cover meals and other minor expenses for the day such as local transportation, snacks and drinks, tips, etc. Lodging and international travel costs are not generally covered by per diems.

Per diem maximum rates are fixed and depend on the destination and duration of travel. As with most countries, per diems are not considered salary and thus not taxable for employees up to the maximum set amount.

Domestic allowance rates in 2023

• Daily allowance: € 19.60 since December 1st, 2022
• Accommodation allowance for overnight stay (min. 75km from the employee’s home): € 147.04 per night since December 1st, 2022

Allowance rules

For an employee to be entitled to a daily allowance, their business trip must last a minimum of six hours.

The employee’s business trip must take them more than 25 km from the centre of the commune where they reside.

The employee can receive no other compensation for meals or accommodation. The accommodation allowance will be lower if the employee is staying with a friend or relative than if they are staying at a hotel.

Foreign daily allowance rates

Foreign allowance or per diem rates vary based on the country of destination and can all be found on the Moniteur Belge website. These are also tax-exempt and are meant to cover the cost of meals and incidental expenses for an employee travelling abroad for business.

• Single-day trip abroad (the employee leaves and returns within a 24-hour window)
  • For trips lasting 10 hours or longer: full-day rate of the destination country
  • For trips lasting fewer than 10 hours: no per diem is due. However, a lump sum equal to the Belgian daily allowance can be paid to the employee, tax-free.
• Multiple-day trip abroad
  • Day of departure and of return: 50% of the daily rate of the destination country
  • All other days spent abroad: full-day rate of the destination country

Special rules apply to civil servants based on their rank.

Meal deductions to foreign daily allowance rates

The above lump sum allowances are intended to reimburse employees for business travel expenses abroad. If a meal is otherwise not paid for by the employee, the following deductions apply

• Breakfast: 15%
• Lunch: 35%
• Dinner: 45%
• Incidentals: 5%

Deductions do not apply on days where the full day rate is not paid, i.e. the first and last day of travel.

For more on daily allowances in Belgium, have a look at our .

Mileage allowance

The maximum tax-free mileage allowance in Belgium per period can be found in the table below, regardless of the vehicle. Any allowance in excess of these amounts will be considered as taxable income for the employee by the Belgian tax authorities.

Digital archiving in Belgium

Digital archiving of paper receipts is allowed in Belgium. Therefore, scanned receipts have the same validity as their paper counterparts as long as the integrity and authenticity of the receipts can be ensured by the company.

VAT recovery

Companies which correctly abide by Belgian regulations can apply for foreign VAT recovery. They can choose to either submit their own recovery claims, or appoint a VAT reclaim partner to do it for them.

Some of the most commonly eligible expenses for VAT recovery include:

• Hotel stays
• Car rentals
• Conferences and events
• Training
• Marketing.

Note that for VAT reporting and reclaim, original paper receipts may be required by the tax authorities.

With numerous customers active in Belgium, Mobilexpense has mastered the country’s expense report compliance requirements. Our Compliance Department actively monitors compliance updates from 70+ countries and updates the solution with the latest changes. From per diems to commuting allowances all the way to integrated VAT reclaim, we guarantee our customers peace of mind and hassle-free expensing.

Whether you are a Belgian company or a multinational active in Belgium, Mobilexpense has the right compliance solution for you.