Are there taxes on the sale of shares?

A person who owns shares should know about taxes on the sale of shares and the tax situation of capital gains and losses on shares. The frantic pursuit of revenue by successive governments may have an influence on this situation.

Capital gains on shares are not taxed 

Only the payment of dividends is subject to tax: withholding tax is levied. But after the deduction of a discharging withholding tax, the dividend is acquired. However, the profit (capital gain) from the sale of shares is not taxed. For this reason, some people refer to our country as a 'tax haven'. However, there are some exceptions: the speculative gains, internal gains and capital gains as a professional trader are subject to tax. If the profits are made in the framework of the management of a private estate or a professional activity, there is no tax.

The programme act of 25 December 2017 

With this law, the government intended to stimulate savings by making investments more attractive.

  1. The first bracket of €804 in dividends (2019 earnings, 2020 taxation year) is exempt from withholding tax, which provides a benefit of €241,2 per taxpayer.
  2. Only the dividends from regular shares (Belgian or foreign) are taken into account for this exemption.
  3. This exemption does not mean that withholding tax will not be deducted at the moment of payment. You could, however, get back the withholding tax via your tax declaration.

Increase in the standard rate of withholding tax 

The standard rate of withholding tax has undergone a sharp increase in recent years. Since 2012, there have been four increases:

  • 1 January 2012: from 15 to 21 or 25%,
  • 1 January 2013: up to 25%,
  • 1 January 2016: up to 27%,
  • 1 January 2017: up to 30%.

Example of an exception: a large amount of shares 

Art 90, 9° of CIR 1992 provides for the taxation of capital gains in the case of the sale of a large amount of shares in a Belgian company to a foreign company. Therefore, someone who sells more than 25% of the shares in a Belgian company to a foreign company is taxed at 16.5% for the capital gains. Note that when the tax authorities consider such gains to be speculative profits, article 90, 1° CIR 1992 states that the rate of 33% applies. Some people are concerned that this taxation will soon apply to all cases of the sale of shares.

Capital losses are not deductible 

With the good news comes the bad news. As the profits from the sale of shares are not taxed, it is logical that the capital losses from the sale of shares are not deductible.

Do not forget the stock market tax 

It is not because the profits from the sale of shares are not taxed that there is no tax to pay when shares are sold or purchased. In these two cases, a stock market tax must be paid. In January 2012, this tax increased from 0.17 to 0.21%, and in March it rose to 0.25%. On 1 January 2016, the stock market tax was 0.27%, and on 1 January 2018, the tax on shares increased from 0.27 to 0.35%. The tax on bonds increased from 0.09 to 0.12%. For capitalisation funds, this tax increased in three stages from 0.5% (in 2011) to 1.32% (in 2018). Until now, in Belgium, the gains from the sale of shares are therefore not taxed in personal income tax declarations. The gains from shares in companies have, however, been taxed since 1 January 2018. 

Tax on securities accounts 

Any private individual with a securities account of a total value of at least €500,000 will now pay a tax of 0.15%. Many financial products, such as shares, are subject to this.  You can find out more here.

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