Provision of a Company Car by a Foreign Employer: New Circular Clarifies when Belgian VAT is Due

Background

In Belgium, company cars are well established in the remuneration policy for tax reasons.

VAT on costs (purchase, lease, fuel, maintenance costs, etc.) relating to (freely provided) company cars can be deducted in Belgium in proportion to professional use (Article 45, § 1d W.VAT). However, the VAT deduction may never exceed 50%, even if the professional use is higher (Article 45, §2, first paragraph W.VAT).