Context

As mentioned in our PTX headlines of 13 January 2003(*), the Law of 26 March 1999 addressing the tax treatment of stock option has been amended (Loi-Programme- Programmawet of 24 December 2002 – Official Gazette of 31 December 2002). A major opportunity has been made available for stock option plans concluded between 1 January 1999 and 31 December 2002. The company which offered the options may, before 30 June 2003 (still one month left), with the agreement of the beneficiaries of the stock options, extend the exercise period of these options for a maximum 3 year period without additional Belgian income tax cost. This agreement to extend the exercise period must be notified to the Tax Authorities before 31 July 2003.

News

A new circular from the Belgian tax authorities has been recently issued in this respect (Ci.RH.241/556.163 (AFER 10/2003) dd. 28.04.2003). It appears from the circular that options qualifying for such extension are those:
- offered from 2 November 1998 to 31 December 2002,
- when the beneficiary did not refuse in writing prior to the expiration of the 60-day deadline (i.e. options that became taxable at the expiration of the 60-day deadline),
- which did not expire prior to the extension.

Option agreements that expired prior to the extension do NOT qualify. Despite the fact that the practice note does not require that all beneficiaries should be offered this opportunity, it is valuable to note that restricting the eligibility for such an opportunity may, depending on circumstances, be regarded as discrimination not allowed under the Belgian anti-discrimination act of 25 February 2003. Further details and how the notification formality must be complied with may be found in the link below.

The administrative circular is available:
French: http://news.hrservices.be?lk200305271
Dutch: http://news.hrservices.be?lk200305272

(*) http://news.hrservices.be?200301131741