Context

A new Royal Decree adapting the wage withholding tax section of the Royal Decree of the Income Tax Code has just been published on 4 July 2002 in the Official Gazette.

As explained in our PTX Headline news of 5 December 2001, Belgian tax on taxable pay is mainly remitted to the tax authorities by the employer as wage withholding tax. On June 30 of the second year following the income year at the latest (e.g. June 30, 2004 for income of 2002) the tax payer will finally have a tax due or a tax refund depending on the previously withheld tax.

Due to the fact that some scales from the wage withholding tax still had to be adjusted, the taxpayer could not fully benefit from the advantages of various favourable tax measures (measures from the individual tax reform and the progressive suppression of the supplementary crisis contribution).

News

As from 1 October 2002, the adjustment of the tax scales will be fully integrated in the computation of the wage withholding tax.

The modifications are mainly favourable for the taxpayers and are also technical adaptations due to the Euro conversion.

If you would like more information, please find the Official Gazette extract at the following address: http://www.hrconsulting.be/ias/docs/OG_wwt_102002.pdf