Summary

Belgium operates a comprehensive social security system which provides a range of old age, invalidity, sickness, unemployment and other social benefits, including family allowances and income guarantees. Entitlement to benefits generally derives from and individual’s contribution history, although some benefits arise due to residence in Belgium.

Current market practice is generally to try to avoid becoming liable to Belgian social security due to its high cost.

Details

Contributions

Belgium is a high cost social security location. Individual contributions are in excess of 13% of gross pay (with no cap), and 27% for employers.

Treaties

Belgium has social security agreements with all European Economic Area countries and more than 25 non EEA countries. These agreements determine which country has the right the levy social security contributions, has the obligation to provide benefits, and prevent social security being levied twice on the same income. Most inbounds expatriates to Belgium therefore continue to pay home country social security rather than Belgian contributions.

The Belgian authorities are very reluctant to agree to extend exemption from Belgian social security beyond the statutory norm for inbounds from these agreement countries.

Expatriates moving to and from Belgium from other countries (much of Africa and Asia) may have to pay double contributions.

Exemptions

Tax free allowances (up to a maximum of 30%, with an absolute maximum of €90,000) granted to expats under the new special tax regime are exempted from employee and employer social security contributions. In addition, the reimbursement of school fees, moving and set up expenses can be made free of social security.

Administration

Contributions to the 11 different branches of Belgian social security are paid to a single state entity, the NSSO. All contributions for employees are paid via payroll.

Benefits

The various benefits available under the Belgian social security system are administered by separate national institutions. The Belgian state pension is the most significant benefit, and this is calculated by reference to the number of years of contributions in Belgium.

Other

Most individuals moving to Belgium for work are required to have a LIMOSA declaration completed by their employer before the period of work in Belgium. In general terms, making a LIMOSA declaration informs various Belgian authorities of the potential liability to tax, employment law and social security arising from work being performed in Belgium

Social Security contributions are deductible for income tax purposes in Belgium.

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