Belgian Exit Tax upon Emigration
As from 1 January 2026, Belgium applies a capital gains tax (CGT) to gains realised through the transfer for consideration of certain financial assets.
The new rules also include an exit-tax mechanism. When an individual ceases to qualify as a Belgian tax resident, this departure is treated as if the relevant financial assets had been transferred for consideration.
Consequently, Belgium calculates a capital gain based on the difference between the value of the financial assets at the time of departure and their relevant acquisition or reference value. This gain is not actually realised because the taxpayer has not necessarily sold the assets. It is therefore commonly referred to as a latent capital gain.
The corresponding Belgian CGT is the exit tax.
Without a payment-deferral mechanism, taxpayers could therefore face a Belgian tax liability even though they have not received any sale proceeds with which to pay the tax. The practical application of these rules has recently been further clarified by the Belgian tax authorities in Administrative Instruction No. 2026/C/74.
Automatic Deferral within the EU, EEA and Certain Treaty Countries
To comply with European principles, Belgian law provides for an automatic deferral of payment when the taxpayer moves to:
- another Member State of the European Union;
- a Member State of the European Economic Area; or
- a country with which Belgium has concluded a double tax treaty that provides for both the exchange of information and mutual assistance with tax recovery.
The existence of a double tax treaty with the taxpayer’s new country of residence is therefore not sufficient in itself. Many Belgian tax treaties provide for the exchange of information but do not include effective mutual assistance with tax recovery (e.g. Switzerland, UAE, Singapore, Israel, etc.). Where the applicable treaty does not contain both elements, the automatic deferral does not apply.
Where the conditions are met, the taxpayer does not have to submit a separate application to obtain deferral. The payment of the exit tax is automatically suspended. This does not mean that the exit tax immediately disappears. The taxpayer must continue to satisfy several conditions during the 24 months following the loss of Belgian tax residence.
24-Month Monitoring Period
The automatic payment deferral is maintained only if the taxpayer continuously satisfies two principal conditions during the first 24 months after leaving Belgium:
a. Financial assets may not be sold
The taxpayer may not transfer the financial assets for consideration during the 24-month period.
The taxpayer may also not subject the assets to a financial collateral arrangement that results in a transfer of ownership. A standard pledge that merely permits a future transfer in the event of default should not, as such, terminate the deferral for as long as ownership has not actually been transferred.
Certain tax-neutral transactions should nevertheless remain possible. A transaction that would have benefited from a statutory exemption and would not have triggered an effective CGT if the taxpayer had remained resident in Belgium should, in principle, not terminate the payment deferral.
This may include certain tax-neutral contributions or a division of assets following a divorce, provided that the applicable Belgian exemption conditions are satisfied.
b. Taxpayer remains in an eligible country
During the same 24-month period, the taxpayer must continue to reside in:
- EU
- EEA or
- another qualifying treaty country offering the required exchange-of-information and recovery assistance.
The taxpayer may move between qualifying countries during this period without losing the payment deferral. The 24-month period reflects the purpose of the exit-tax provision. It is intended to prevent taxpayers from temporarily moving abroad, selling their financial assets shortly afterwards and thereby attempting to avoid the Belgian CGT.
What Happens When Assets Are Sold?
When a taxpayer sells only part of the relevant financial assets during the 24-month period, the payment deferral is terminated only proportionally.
Assume that a taxpayer owns 100 shares when leaving Belgium and receives an automatic deferral for the exit tax calculated on those shares. If the taxpayer sells 20 shares during the following 24 months, the exit tax relating to those 20 shares becomes payable. The payment deferral remains in place for the remaining 80 shares.
The termination of the deferral is therefore linked to the assets that were actually transferred and does not necessarily make the entire exit-tax assessment immediately payable.
Moving to a Non-Qualifying Country during the trailing period
A taxpayer who initially moves to a qualifying country may subsequently relocate to a country that does not provide the required tax-information exchange and recovery assistance. In principle, this would terminate the automatic payment deferral.
The taxpayer may nevertheless preserve the deferral by providing sufficient security for the payment of the exit tax. This must be arranged with the competent Belgian tax-collection office, which will determine whether the proposed security is acceptable.
Without sufficient security, the remaining deferred exit tax becomes payable in full.
Deferral upon Request for Other Countries
Different rules apply when a taxpayer moves directly from Belgium to a country outside the EU or EEA that does not have an appropriate treaty framework with Belgium.
In that case, the payment deferral is not automatic.
The taxpayer must formally request the deferral from the Belgian tax authorities and provide sufficient security for payment of the exit tax.
Acceptable security may include:
- bank guarantee
- deposit with the Belgian Deposit and Consignment Office or
- pledge over financial instruments.
The competent Belgian tax-collection office must approve the proposed security.
Once granted, this optional deferral is also subject to the 24-month restriction. If the financial assets are sold or transferred for consideration during that period, the corresponding exit tax becomes payable.
As with the automatic deferral, genuinely tax-neutral transactions that would not have triggered an effective tax charge for a continuing Belgian resident should not necessarily terminate the deferral.
Annual Reporting Requirement
The payment deferral is not entirely free from formalities.
Taxpayers benefiting from either an automatic or requested deferral must provide the Belgian tax authorities with an annual certificate confirming that the applicable conditions remain satisfied.
The precise contents of the certificate and the applicable filing deadlines are to be determined later on by Royal Decree.
This reporting obligation should not be overlooked. If the certificate is not submitted on time, the conditions for the payment deferral are deemed no longer to be satisfied. The deferred exit tax may then become immediately payable.
Taxpayers leaving Belgium should therefore retain detailed records of:
- financial assets held at the time of departure
- ownership throughout the 24-month period
- sales, transfers, pledges or reorganisations involving those assets
- successive countries of tax residence and
- security provided to the Belgian authorities.
When Does the Exit Tax Disappear Permanently?
Provided that the deferred exit tax has not already become payable because of a sale or another disqualifying event, the obligation to pay the tax is permanently cancelled in two situations:
a. Taxpayer returns to Belgium within 24 months
The payment obligation is cancelled when the taxpayer re-establishes Belgian tax residence within 24 months after departure.
This remains the case even when the taxpayer subsequently leaves Belgium again within the original 24-month period.
A new departure will, however, constitute a new exit-tax event. The latent capital gain must then be recalculated based on the value and circumstances existing at the time of the new emigration.
b. Taxpayer remains abroad more than 24 months
The payment obligation is also permanently cancelled when the taxpayer remains a foreign tax resident for more than 24 months.
After that period, the taxpayer is considered to have emigrated on a sufficiently permanent basis and not merely to have moved abroad temporarily in order to realise a capital gain.
The Belgian exit tax therefore functions primarily as a 24-month anti-avoidance measure rather than as an indefinite tax claim on former Belgian residents.
Practical Attention Points before Leaving
Individuals holding substantial investment portfolios should review the exit-tax consequences before terminating Belgian tax residence.
Particular attention should be given to:
- determining which financial assets fall within the scope of the exit tax
- documenting their market value at the time of departure
- identifying the country in which the taxpayer will become resident
- confirming whether the payment deferral is automatic or must be requested
- avoiding unintended disposals during the 24-month period
- arranging sufficient security where required and
- complying with the annual certification obligation.
The rules may also influence the timing of a planned sale. Selling financial assets shortly before departure, during the 24-month period or after that period can produce significantly different Belgian tax consequences.
Key Takeaway
Belgium’s new exit tax does not necessarily require immediate payment when a taxpayer moves abroad.
Taxpayers relocating to the EU, EEA or an eligible treaty country generally benefit from an automatic payment deferral. Those moving elsewhere may request a deferral if they provide sufficient security.
The key period is the first 24 months after emigration. During that period, the taxpayer must generally retain the relevant financial assets, remain in an eligible jurisdiction or provide security, and comply with the annual reporting requirement.
If these conditions are respected and the taxpayer remains abroad for more than 24 months, the obligation to pay the deferred exit tax normally disappears permanently. Because the rules combine valuation, residence, collection and reporting requirements, advance planning is strongly recommended before leaving Belgium with a (significant) financial investment portfolio.
The legal framework and examples discussed in this article are based on the Belgian tax administration’s clarifications in Administrative Instruction No. 2026/C/74 regarding Article 413/1, §6 of the Belgian Income Tax Code.