If you employ staff in Belgium, you are normally liable for a 25% social security contribution on top of the gross salary. The employee’s gross salary itself is subject to a standard 13.07% deduction.
Already for a couple years, new employers can receive a full exemption when hiring a first employee in Belgium. In that case, you are not required to pay the standard employer contribution for the entire employment period. Only some (smaller) contributions are due, such as the contribution for holiday pay for blue-collar workers, Asbestos Fund contribution, special social security contribution and some sectoral contributions (if any).
The exemption is also not linked to a particular employee. As an employer, you are free to choose each quarter for whom you apply the exemption. Even if the first employee would have left the company already, the exemption will continue for another employee. The exemption therefore runs indefinitely, which creates an important incentive.
What will change now in 2022?
As indicated, a full exemption applied before, irrespective of the employee’s salary level. From the first quarter of 2022, however, the contribution discount for the first employee will be limited to €4,000 per quarter. This also applies if your first employee was already employed before 1 January 2022. If the gross monthly salary of your first employee exceeds €5,333.33, social security contributions will be due to some extent.
For example, if your first employee has a monthly gross salary of €5,500, there were no employer social security contributions due up to and including the fourth quarter of 2021. From 2022 onwards, you will have to pay a quarterly contribution of €125, which is calculated as follows: (€5,500 x 3 x 25%) – € 4,000). The total discount will therefore be smaller, but still creates a significant saving.