New 6% VAT Regime Expands to Investor Sales in Demolition-Reconstruction Projects

• Revised VAT framework for demolition-reconstruction projects offers more flexibility for developers and investors.
• Developers can sell to private individuals for sole residence, investors for social housing, or long-term residential purposes.
• New regime effective from 1 July 2025, with a strengthened surface cap of 175 m² for the 6% rate.
• No timing constraints for building permits or start of works.
• Full demolition and reconstruction required, with compliance to VAT administration formalities.
• 6% VAT applies to most units, except for private buyers with another dwelling or short-term letting investors.
• Developers can sell to owner-occupiers and long-term investors without losing VAT benefits.
• Single sale taxed at 6% VAT on the entire property is generally cost-effective.
• Developers should review projects for 6% eligibility, update pricing models, and brief teams on new rules.
• Monitor final law publication and guidance for confirmation and requirements.

Source: news.pwc.be

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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