The investment deduction of 25% already knew many changes since its start. Following Corona further adjustments have been made.
If certain conditions are met, this deduction allows a part of the profit to be exempt up to a certain percentage of the acquisition or investment value of new tangible and intangible fixed assets that are used in Belgium for the exercise of a professional activity.
Only SME companies can apply the ordinary one-off investment deduction. These are companies that are classified as a small company in accordance with the Company Code. A company is small if it does not exceed more than one of the following criteria for the last closed financial year:
If more than one of the criteria are exceeded or are no longer exceeded, this only has consequences if this occurs in two consecutive financial years. The consequences will then take effect from the following financial year.
In case of affiliated companies, the criteria for turnover and balance sheet must be calculated on a consolidated basis.
The company must then be small in the year of the investment, this is in the financial year in which the investments become depreciable.
The base percentage is 8%.
For investments done between January 1st 2018 and December 31st 2019, this percentage was temporarily increased to 20%. From January 1st 2020, the base rate of 8% would then apply again. However, following the Covid pandemic, it was again temporarily increased, this time to 25% and this for investments made from March 12th 2020 to December 31st 2020.
The latter measure was then further extended for qualifying investments until December 31st 2022.
Attention: the investments are linked to the calendar year and not to the financial year!
The extension is good news for SMEs. You still have until the end of next year to make investments that qualify for the increased deduction.