In Belgium, succession planning is shaped by a long-standing cultural balance between private property rights and familial transmission. The preservation and growth of family wealth across generations remain deeply rooted in Belgian society and are closely linked to a generally conservative outlook on inheritance: assets are expected to remain within the close, biological family.

This cultural background explains the central role of the forced heirship regime, which protects descendants and, to a lesser extent, the surviving spouse. Belgian law has traditionally imposed significant limits on freedom of testation through the concept of the reserved portion. Although recent reforms to succession law have modernised and simplified this framework – most notably by fixing the descendants’ reserved share at half of the estate regardless of the number of children – the protection of children remains a fundamental and deeply embedded principle.

In addition, the tax environment strongly influences succession planning trends. Both small and large families are increasingly aware of the importance of planning. Because of the favourable tax rates applicable on gifts (especially in relation to movable assets and family businesses), transfer of wealth is generally done during life and not at death. For that reason, a wide range of structures are used in Belgium at the occasion of the wealth transfer to maintain a certain degree of control and benefit of the transferred assets at the level of the donor. Also, gifts retaining usufruct are a very often used scheme in Belgium. There is a desire to pass on assets earlier than in the past. Moreover, planning is sometimes more complex in the case of reconstituted families.

Finally, while charitable giving and legacies to third parties do exist, they generally play a secondary role compared to family transmission. Overall, succession planning in Belgium remains predominantly family-oriented, combined with a strong respect for mandatory family rights.

In Belgium, a few recurring “wealth cohorts” are typically seen. The first and most traditional cohort consists of multi-generational family capital holders and family business owners. Their wealth is often concentrated in family holding companies and long-standing operating businesses. Client expectations within this group typically focus on maintaining asset consolidation, avoiding fragmentation among heirs and preserving family control over key assets. Succession planning therefore places strong emphasis on control mechanisms such as centralisation through a neutral entity (société simple or private foundation), shareholder agreements, usufruct structures and internal blocking mechanisms within corporate structures.

A second cohort consists of clients whose wealth is primarily composed of liquid financial assets, such as securities portfolios and private equity investments. These clients seek to organise the transfer of wealth while remaining attentive to the structure and regulatory constraints of their investments. They generally wish to retain a significant degree of control in order to continue managing investment strategies and decision-making.

A third cohort, which has grown significantly in recent years, comprises cross-border and internationally mobile families. The vast majority of families now have at least one member living abroad. New generations often establish their residence in several countries before settling permanently. With Belgium being a very small country in the centre of Europe, many Belgian residents transferring wealth need to take foreign taxation regimes into account because of family members living abroad, tails applying in relation to a previous residency or assets held abroad. Client expectations in this context are shaped by the need to address international legal considerations, including the interaction between Belgian succession planning and foreign legal systems. Planning must therefore co-ordinate Belgian civil law and tax rules with the legal and fiscal implications arising in other jurisdictions.

“Residency” has a factual meaning under Belgian law. It is characterised by a certain permanence or continuity, independent from the (Belgian concept of) “domicile” or nationality of a person. It concerns the place where a person lives and works – ie, the place where his/her family is housed, and where he or she stays permanently, maintains his/her relationships, etc.

Residency in Belgium triggers inheritance tax on worldwide assets. By contrast, for estate taxation purposes, the overriding factor is the location of immovable property in Belgium. As an exception, gifts of movable assets are taxable in Belgium by way of the donor’s residence.

For civil law purposes (right to make a will, submission to Belgian jurisdiction for claims), the notion of residence is similar. In an international context, most matters are harmonised by European regulations, which refer to the concept of habitual residence. Habitual residence is characterised by a certain degree of permanence or continuity and corresponds to the place where a person lives and works.

Belgian residents are taxed on their worldwide income. As stated in the foregoing, tax residency is a factual notion. However, for income tax purposes, two presumptions apply to determine one’s residency in Belgium. First, there is a rebuttable presumption that a person registered in the Belgian national register is deemed a Belgian resident for personal income tax purposes. The second presumption is irrefutable and qualifies a person as resident if his/her family is living in Belgium.

The “seat of fortune” is also relevant for personal income purposes, and only applies in the absence of a Belgian residence. The “seat of fortune” is located in Belgium, at the place where a private individual is managing or controlling his/her assets from Belgium – even if the assets are not located in Belgium. The localisation of his/her assets in Belgium is a rebuttable presumption for this test. Patrimonial interests as well as general economic interests are relevant for this test.

The notion of “citizenship” has no tax consequences in Belgium (aside from under the last criterion of the tie-breaker rules of double tax treaties in relation to residency).

In the absence of a will, Belgian succession law applies a statutory order of succession based on family proximity. Descendants rank first and inherit in equal shares. In such case, the surviving spouse is entitled to the usufruct over the entire estate, while the descendants receive the bare ownership. The surviving spouse is also entitled to the usufruct over assets that were donated by the deceased during his or her lifetime with a reservation of usufruct, provided that the spouses were already married at the time of the gift and that the deceased retained the usufruct until death.

Where there are no descendants, but there are ascendants or collateral relatives up to the fourth degree, the surviving spouse inherits the deceased spouse’s share in the matrimonial community, and their share in any property held in indivision exclusively between the spouses, in full ownership. They also benefit from the usufruct over the remainder of the estate.

If there are no descendants, ascendants or collateral relatives up to the fourth degree, the surviving spouse inherits the entire estate in full ownership. Ascendants and collateral relatives (up to the fourth degree) inherit only in the absence of descendants, and their rights are subordinate to those of the surviving spouse.

Where a will exists, freedom of testation is nevertheless limited by the reserved portion (see 3.2 Forced Heirship). Any testamentary dispositions or lifetime transfers that infringe upon the reserved portion are subject to reduction at the request of the protected heirs.

Belgium has a well-defined legal framework for inheritance, which includes a forced heirship system that ensures children and spouses receive a portion of the estate. Children are entitled (together and regardless of their number) to (at least) 50% of the countervalue of the estate (leaving a portion of 50% that the deceased can dispose freely). The surviving spouse is entitled to a reserved portion corresponding to 50% of the estate in usufruct, which must in any case include the usufruct over the family home.

Belgian law does not provide for elective share statutes in the common law sense. These forced heirship rules are matters of public order. Of course, heirs are not forced to invoke the forced heirship rules, but it is a right they have. Based on the European regulation on successions, a Belgian resident, if a citizen of another country, can opt for the inheritance rules of the country he or she is a national of.

These family protection rights cannot be waived in advance. Waiver is only possible after the opening of the succession. However, if gifts have been made that would involve the forced heirship rules, an inheritance pact can be undersigned by the donor and his or her heirs in order to waive forced heirship rules in relation to that gift, providing some strict formalities are respected.

The treatment of marital property upon death depends primarily on whether the spouses are married under the statutory community regime (a regime of separation of assets combined with a limited community of assets acquired during marriage) or a separation of property regime.

Under the statutory community of property regime (which applies by default in the absence of a marital agreement), assets acquired during the marriage form part of the community property, while assets owned prior to the marriage or received by gift or inheritance remain separate. Upon death, the community is first liquidated: one half belongs to the surviving spouse by virtue of matrimonial property law and does not form part of the deceased’s estate. Only the deceased spouse’s own property and his or her share of the community fall into the estate and are subject to succession rules.

Under a separation of property regime, each spouse retains ownership of his or her own assets, and the estate consists solely of the deceased spouse’s personal property.

Within the legal regime, to dispose of or alienate common assets, the consent of both spouses is required. If the consent of one spouse is lacking, he/she may subsequently seek the annulment of the transfer (without automatically obtaining it, as this will depend on whether the transfer harmed the interests of the household). However, the management of the common estate is concurrent, meaning that either spouse may independently perform acts of management related to the common property. The management and disposition of a spouse’s separate (own) property is carried out by that spouse alone.

Lifetime gifts made by the deceased are, in principle, taken into account for the calculation of the reserved portions. If such gifts infringe the reserved share of the children or the surviving spouse, they may be subject to reduction after death. Reduction generally takes place by way of monetary compensation, but may, depending on the circumstances, also be effected in kind.

Belgian law recognises and enforces both prenuptial and postnuptial agreements. Prenuptial agreements (marriage contracts) must be executed by notarial deed prior to the marriage. They primarily govern the matrimonial property regime, allowing spouses to opt out of the statutory community regime in favour of a separation of property regime or a tailored community arrangement. Postnuptial agreements must likewise be executed by notarial deed during the marriage and allow spouses to modify their matrimonial property regime.

While such agreements cannot derogate from mandatory forced heirship rules, they may determine which assets form part of the deceased spouse’s estate and which belong to the surviving spouse outside the estate.

Belgium will recognise foreign prenuptial and postnuptial agreements provided they have been validly established in accordance with the EU Matrimonial Property Regimes Regulation (Regulation (EU) 2016/1103).

In Belgium, lifetime transfers of property are primarily subject to gift tax, which is a regional tax (Flanders, Wallonia and the Brussels-Capital Region all apply their own rates and rules). The tax treatment depends on the nature of the asset transferred, the form of the gift and whether the gift is registered.

Gifts of moveable property are subject to gift tax if the gift is completed before a Belgian or foreign notary. Manual and indirect gifts (bank transfers, remission of debts, etc) are not subject to gift tax as long as they are not registered, but inheritance tax is due if the donor passes away as a Belgian resident within five years of the gift. Gift tax rates depend on the applicable regional legislation (invoking the same factors as for inheritance tax). In the Flemish and Brussels-Capital Regions, movables are taxed at a reduced flat registration rate of 3% for gifts in direct line and between partners (eg, spouses). Gifts to other private individuals are taxed at 7%. In Wallonia, the rates are:

• 3.3% for gifts in direct line and between spouses or legal cohabitants; and
• 5.5% for gifts to other private individuals.

Gifts of Belgian real estate, in all three regions, are subject to progressive tax rates ranging from 3% to 27% in direct line and between partners (eg, spouses). Gifts of foreign real property are tax-exempt, and no surviving period of five years apply.

A favourable tax regime applies to the transfer (by gift or death) of a qualifying family business/(shares of a family) company in all three regions. For family businesses, a reduced gift tax rate of 0%/exemption (direct line and between partners) may be claimed (subject to conditions) in all three regions. A gift does not trigger capital gains tax.

In Belgium, transfers of property on death are subject to inheritance tax, which is levied at the regional level (Flanders, Wallonia, and the Brussels-Capital Region). The applicable regime is determined by the deceased’s tax residence during the last five years of life, as rates and exemptions differ between regions.

Inheritance tax is due by the heirs/legatees on the net amount inherited by each of them (in direct line or between siblings in the Flemish region and in the Brussels-Capital Region, and in all circumstances in the Walloon region) or on the net amount of the total assets acquired by all the beneficiaries (for transfers between any other persons in the Flemish region and the Brussels-Capital Region) from the estate of any deceased person who was a resident of Belgium at the time of death.

Inheritance tax is calculated on the market value of the assets at the date of death, after the deduction of eligible debts. The applicable inheritance tax rate depends on the relationship of the heirs/legatees with the deceased. In the Flemish region, the maximum inheritance tax rate in the direct line, and between partners (eg, spouses), is 27% (in excess of EUR250,000). In the Brussels-Capital Region and the Walloon regions, the maximum tax rate is 30% (in excess of EUR500,000).

From an income tax perspective, Belgian law does not impose a general capital gains tax on unrealised gains upon death for private individuals. Likewise, Belgium does not apply a step-up in basis comparable to US Internal Revenue Code (IRC) Section 104. As a result, assets generally retain their historical acquisition value in the hands of the heirs for future capital gains purposes.

Regarding inheritance tax, Belgium also has the following exemptions/reductions.

• Flemish region:
1. exemption for the first EUR50,000 or EUR75,000 (movable property);
2. partners (excluding “partners” who are descendants in the direct line) benefit from an exemption for the first band, corresponding to EUR50,000 of the net acquisition of movable property;
3. in the direct line of descent, and insofar as the other parent of the child concerned has already died, an entitled child under the age of 21 benefits from an exemption from inheritance tax on the first EUR75,000 of the net acquisition of movable property;
4. partners inheriting the family home benefit from an inheritance tax exemption;
5. exemption for the dwelling of the surviving parent – insofar as the other parent of the child concerned has already died, inheritance tax for immovable property in the direct line is not applied to the net acquisition by an entitled child under the age of 21 on the dwelling that, at the time of the death of the surviving parent, was the dwelling where the testator was domiciled at the time of death;
6. for family businesses, a reduced inheritance tax rate of 3% (direct line and between partners) or 7% (between other persons) may be claimed (subject to conditions); and
7. other rebates and reductions, including (i) for heirs who are direct descendants or a partner, as long as the net value of the total movable and immovable property received does not exceed EUR50,000; (ii) for siblings/others, as long as the acquired net assets do not exceed EUR75,000; (iii) a rate of 0%, which applies to bequests made to, amongst others, the regions, communities, provinces and municipalities of the Flanders region, approved Flemish housing corporations, (international) non-profit organisations, foundations of public interest and analogous European legal entities; (iv) a rate of 8.5%, which applies to bequests made to professional associations and private foundations, and analogous European legal entities; (v) rebates for legatees with a disability; (vi) reduction for a legatee who is the child of the deceased and younger than 21; (vii) a 50% reduction in the event of another transfer due to a further death within one year of the original death; (viii) a reduction for “friends” (“inheritance between friends”); (ix) an exemption of 50%, 75% or 100% for unbuilt immovable properties for which a nature management plan has been approved; and (x) if the assets of a national resident’s estate contain foreign assets that give rise to the levying of inheritance tax abroad, the inheritance tax due, according to the taxable value of these assets, is reduced by the amount of tax levied abroad, converted into euros, on the date of payment of such tax.
• Brussels-Capital Region:
1. exemption for the first EUR15,000 – applicable to the inheritance of an heir who is a direct descendant legally entitled to inherit (increased for surviving children who have not reached the age of 21 years) or a partner;
2. partners inheriting the family home benefit from an inheritance tax exemption;
3. for family businesses, a reduced inheritance tax rate of 3% (direct line and between partners) or 7% (between other persons) may be claimed (subject to conditions); and
4. other rebates and reductions, including (i) a rate of 0% (exemption) for bequests made to, amongst others, the regions, the communities, the Brussels urban agglomeration, a member state of the European Economic Area (EEA) or assimilated legal persons governed by public law and public institutions of the aforementioned entities; (ii) a rate of 7% for bequests to the municipalities of the Brussels-Capital Region and their publicly owned entities, the limited-liability co-operative society of the Brussels-Capital Region Housing Fund (Fonds du Logement de la Région de Bruxelles-Capitale), intermunicipalities of the Brussels-Capital Region, foundations of public interest, non-profit organisations and other non-profit legal entities on receipt of federal approval (on the date of death or within the following year); (iii) 25% for bequests to, amongst others, (national unions of) health insurance funds, professional associations, (international) non-profit organisations and private foundations; (iv) a reduction for a legatee who is the child of the deceased and younger than 21; (v) a reduction for “friends” (“inheritance between friends”); and (vi) a 50% reduction in the event of another transfer due to another death within one year following the first death.
• Walloon region:
1. exemption for the first EUR12,500 – applicable to the inheritance of an heir who is a direct descendant (increased for surviving children who have not reached the age of 21 years) and is legally entitled to inherit, and to a spouse or statutory cohabitant;
2. partners inheriting the family home benefit from an inheritance tax exemption;
3. for family businesses, an exemption may be claimed (subject to conditions);
4. other rebates and reductions, including (i) a rate of 0% (exemption) for bequests made to, amongst others, the regions, the communities, the federal state, a member state of the EEA or one of its institutions and any entity created by any such institutions; (ii) a rate of 5.5% for bequests to, amongst others, the provinces, municipalities, publicly owned entities of the provinces and municipalities, inter-municipal organisations and autonomous municipal undertakings located in Belgium, and to analogous entities created in accordance with and subject to the legislation of another member state of the EEA; (iii) a rate of 7% for bequests made to (international) non-profit organisations, mutual undertakings or national associations of mutual undertakings, and private foundations and foundations of public interest; (iv) a reduction for a legatee who is the child of the deceased and younger than 21 (subject to certain conditions); (v) a 50% reduction in the event of another transfer due to a further death within one year of the original death; (vi) exemption for immovable property located within a Natura 2000 site or a site for which an application for Natura 2000 status has been filed, and which is subject to the primary protection regime; (vii) exemption for the value of standing trees growing in woodland and forests, and for the value of shares in forestry companies; and (viii) exemption for unbuilt immovable properties located in the Walloon region on which a long-term agricultural lease or a quarry lease is established, under certain conditions; and
5. restitution of the inheritance tax levied on immovable property located in the Walloon region and totally or partially intended for housing, amounting to 25% of the expenses incurred in order to save energy in relation to that property, up to a maximum amount of EUR2,500 – provided that the heir establishes his or her main residence in the immovable property within the year following the filing of the inheritance tax return and maintains that residence for three consecutive years, and provided that energy-saving works are carried out within three years of that same date.

Belgian law allows for many different planning techniques and opportunities.

Mechanisms often used in practice include:

• reduced rates relating to registered gifts;
• possibilities under civil law (usufruct, indirect gifts, etc); and
• vehicles such as the private foundation or the so-called société simple.

Usufruct and Bare Ownership

Ownership split (usufruct/bare ownership) is fairly widespread in Belgium and makes it possible to transfer assets to young children while retaining control. Usufruct is a legal right that allows someone to use and enjoy the benefits (such as income or resources) of a property that belongs to another person, without owning it. The person with the usufruct, called the usufructuary, can live in the property, rent it out or use it in other ways, but they cannot sell or damage it. Bare property, on the other hand, refers to the ownership of a property without the right to use or enjoy its benefits. The bare owner holds the title to the property but cannot exploit it until the usufruct period ends. Once the usufruct expires (eg, when the usufructuary dies or the term ends), the bare property owner gains full control of the property.

Société Simple

The société simple is often used when structuring an estate plan. It allows assets to be transferred (by a gift of the shares), while control of the assets is maintained by others (usually the parents). The company’s shares may be donated in order to pass on the assets contributed to it. A société simple can be set up in several different situations, given the considerable freedom it offers to create a tailor-made arrangement. This does not require a notarial deed and can be done privately. Also, the société simpleis tax transparent.

Private Foundations

The Belgian private foundation was introduced in 2002 and is now governed by the rules in the Belgian Code on Companies and Associations. Belgian private foundations are subject to legal entities tax (if they engage in commercial/economic activities in more than an accessory manner, a private foundation could be subject to corporate income tax). Being subject to legal entities tax implies that only certain income categories will be subject to income tax (such as dividend and interest income – default rate of 30%).

A private foundation pays a yearly tax on the total of its assets on January 1st, unless this total amounts to less than EUR25,000. Debts (besides certain exceptions, such as operational costs) are not deductible. This is a progressive tax, the rate of which amounts to 0.15% between EUR50,000 and EUR250,000, to 0.30% between EUR250,000 and EUR500,000 and to 0.45% for amounts in excess of EUR500,000. However, against this revised tax, various appeals for annulment have been filed with the Belgian Constitutional Court.

In Belgium, the availability and attractiveness of these mechanisms are significantly shaped by tax rules and broader anti-avoidance principles. With respect to the société simple, anti-avoidance considerations are particularly relevant where the structure is used primarily to disguise the donor’s retained control over the transferred assets. In practice, the robustness of the governance framework and the consistency between the legal documentation and the parties’ actual conduct are therefore critical to mitigate risks.

Regarding private foundations, the applicable tax framework and the related reporting and compliance obligations materially influence their use, in terms of both administrative and tax burdens. More generally, across all such mechanisms, the Belgian general anti-abuse rule in tax matters plays a decisive role. The tax authorities may recharacterise transactions (whether viewed individually or as part of a broader arrangement) where their essential purpose is to obtain a tax advantage that is contrary to the object or purpose of the relevant legislation.

In Belgium, the control and disposition of digital assets upon death are governed by a fragmented legal framework combining general civil law principles, contract law and data protection rules. There is no single, comprehensive statute specifically addressing digital succession.

Under Belgian law, digital assets that have an economic value – such as cryptocurrency accounts – are considered as financial assets, similar to cash. They are therefore part of the deceased’s estate and subject to inheritance tax in the same way as other movable assets. The main legal difficulty is not ownership, but effective control: heirs must be able to identify the asset and access it.

By contrast, purely personal digital assets (such as email accounts or personal social media profiles) do not fit neatly within traditional property concepts. Their fate is often governed less by succession law than by contractual terms imposed by service providers. The General Data Protection Regulation (GDPR) does not apply after a person’s death, and Belgium currently provides for no specific statutory provisions in this regard.

With regard to personal data and, in particular, social media accounts and other online services, it is entirely possible to remedy the absence of specific Belgian legislation by adopting appropriate testamentary provisions. Certain platforms (such as Facebook) expressly require such arrangements in their terms and conditions.

Accordingly, a will may validly include a specific clause determining the treatment of social media accounts and other online services after death. Similarly, in respect of other digital assets with financial value, estate planning may be implemented either inter vivos, by way of a gift, or mortis causa, through a testamentary disposition taking effect upon death. Such planning may expressly take digital assets into account.

Under Belgian law, digital assets, like any other assets, are transferable during the lifetime, and a gift relating thereto is valid in law. Likewise, a will may acknowledge the existence of digital assets and allocate them to the legatees designated by the testator.

The principal difficulties do not lie in the legal transmissibility of the assets themselves, but rather in the practical modalities of transmission, including their identification and location, as well as effective access (particularly where certain assets are held in a hot wallet – ie, through an intermediary third party).

Within the framework of prudent estate planning, specific precautions should be taken, notably with regard to:

• the valuation of such assets and the inherent volatility associated with this asset class; and
• secure access, including the safeguarding of passwords and seed phrases, and the risk of loss or destruction of a cold wallet.

Several estate planning techniques may therefore be contemplated:

• the appointment of a trusted third party entrusted with the credentials for access to crypto-assets, with instructions to transfer them to the designated heirs;
• a traditional movable gift (whether by notarial deed, wallet-to-wallet transfer or manual delivery of a cold wallet, although the legal validity of the latter may be subject to debate); and
• a will (whether holographic, authentic or international), in which the testator either merely records the existence of crypto-assets (an approach carrying certain risks) or, preferably, provides a detailed inventory of crypto-assets holdings together with clear instructions regarding access and recovery.

Finally, particular caution should be exercised when transferring the contents of one wallet to another. A single-character error in the destination address may result in the irreversible loss of the entirety of the transferred crypto-assets.

In Belgium, the most popular method for asset succession planning involves using family foundations and the société simple, along with strategic use of legal structures such as companies, life insurance (under certain circumstances) and holding companies. Each of these methods can provide varying levels of asset protection, but the key focus is on shielding assets from creditors, minimising inheritance taxes and ensuring smooth wealth transfer across generations. These methods need to be analysed and adapted on a case-by-case basis to suit different family situations.

In Belgium, for family business that is an independent activity carried out as either a private individual or as a company, there is the possibility of exemption from gift tax (rate of 0%). Specific rules apply in this respect in the Flemish region, the Walloon region and the Brussels-Capital Region.

It is also possible to obtain a reduced rate of inheritance tax (3% or 7% in the Flemish region and the Brussels-Capital Region, and 0% in the Walloon Region), provided certain conditions are met.

The Belgian private foundation was introduced in 2002 and is now governed by the rules in the Belgian Code on Companies and Associations. It is a legal entity without shareholders, established for a disinterested purpose, and is commonly used for asset protection and structuring through multiple generations. While a private foundation does not distribute profits, it may hold and manage assets and make allocations in accordance with its statutory purpose. It is often used as an alternative to a trust in civil law planning, as this entity does not exist under Belgian law.

Another vehicle frequently used for planning purposes in Belgium, and which is useful for managing family assets transferred to the next generation, is the so-called société simple. This entity is totally tax transparent and therefore has no tax impact. It is used to ensure maintenance of the management of the transferred assets by the donors or trusted managers (as long as the beneficiary of the gift is still too young to manage the assets by themselves).

A private foundation pays a yearly tax on the total of its assets on January 1st, unless this total amounts to less than EUR50,000. Debts (besides certain exceptions such as operational costs) are not deductible. This annual tax was reformed in 2024, with the rate being increased. This is now a progressive tax, the rate of which amounts to 0.15% between EUR50,000 and EUR250,000, to 0.30% between EUR250,000 and EUR500,000 and to 0.45% for amounts in excess of EUR500,000.

Foreign private foundations are recognised as well but can be subject to the “Cayman tax” (see 10.2 Taxation of Trusts).

There is no legal framework for private trust companies in Belgium as the concept is unknown under Belgian law. Also, the use of corporate fiduciaries is not prevalent in Belgium.

If a Belgian tax resident serves as a fiduciary or is a beneficiary of a foreign trust, foundation or similar entity, he or she may be subject to the Cayman tax.

On 1 January 2015, the Cayman tax was introduced and was amended substantially as of 1 January 2018 and 1 January 2024. This is a look-through taxation on private individuals and legal entities (subject to the legal entities tax). Income received by a non- or low-taxed legal construct is taxable income for the founder. Trusts automatically qualify as a legal construct for the purposes of Cayman tax.

With the look-through approach, the underlying income retains its original qualification, and no effective distribution is required for taxation to occur. Interest received by the legal construct remains interest, dividends remain dividends and capital gains remain capital gains. The first two categories of income are generally taxed at a flat rate of 30% in Belgium. Capital gains on moveable assets realised by individuals were generally tax-exempt to the extent that they were realised in the course of the normal management of one’s private assets. However, those capital gains are now taxed at 10% (since 1 January 2026).

The look-through approach is combined with the taxation of income received (or deemed to be received) from legal constructs. Complex rules aim to prevent double taxation of this combined approach, but due to the complexity, this aim is not always achieved. As of 1 January 2024, exemption of taxation upon distribution by the legal construct will no longer apply in case the income received by the legal construct was not effectively taxed under the look-through taxation regime (ie, capital gains on shares). In addition, interposing an intermediary company (which is not a legal construct) will no longer prevent the application of the Cayman tax. In addition, an exit tax was introduced in case the founder of the legal construct migrates to another country. The scope of application of other taxable events (seat transfer of the legal construct, etc) has been enlarged.

The founder can avoid pass-through treatment by showing that the legal construct (other than a trust) meets a substance test in the case of (among other requirements) the exercise of actual economic activities that may not involve the management of the private assets of (one of) the founder(s). The substance requirements were further restricted as of 1 January 2024.

The Cayman Tax does not only apply to offshore legal constructs, but also to companies and legal entities established within the EEA in the case such entities are not sufficiently taxed. Measures can be taken to anticipate the application of the Cayman Tax. For this reason, it is important to seek advice before making investments or setting up foreign structures.

Belgian law accords equal treatment to same-sex and opposite-sex spouses. Non-marital partners may also benefit from legal protection where they are recognised as “legal cohabitants” (a form of registered civil partnership). However, their succession rights are more limited. In the absence of testamentary provisions, a legal cohabitant is entitled only to the usufruct over the family home and its contents. Legal cohabitants do not benefit from forced heirship protection. For gift and inheritance tax purposes, non-marital partners may benefit from the same preferential tax rates as spouses, provided that the cohabitation has lasted for a minimum statutory period. An exception applies in the Walloon region, where only legal cohabitants are entitled to preferential rates, thereby excluding de facto cohabitants.

All children are equal before the law in Belgium, regardless of the circumstances of their conception or the marital status of their parents. Thus, children born out of wedlock have the same rights as those born to married parents: their parentage can be established through recognition, legal presumption or court proceedings, and they enjoy the same inheritance rights.

Adopted children, once a full (plenary) adoption is granted, are legally assimilated to biological children: they inherit from their adoptive parents and no longer from their original family. Adoption creates a complete legal parent-child relationship, fully integrating them into the category of heirs for inheritance purposes.

Regarding children born through surrogacy, Belgium does not have specific legislation, but the practice is not prohibited. It is tolerated as long as it is non-commercial and the intended parenthood is based on the informed consent of all parties involved. Legal parentage depends on postnatal legal establishment and not merely on intention or genetic connection. An intended parent may become a legal parent through recognition or adoption, provided the legal conditions are met.

Children conceived after the death of a parent (posthumous conception) may, under strict conditions, be legally recognised. Belgian law does not explicitly prohibit posthumous medically assisted reproduction, but such a child can inherit only if legal parentage is established within the prescribed time limits.

In all cases, inheritance rights depend on legal parentage. Belgian law recognises the child as descending from their legal parents, even in the absence of a genetic link (particularly in cases of adoption or surrogacy). Thus, it is the legally established parent-child relationship (and not merely the genetic or biological one) that determines whether the child is included among the heirs.

Depending on the region, the following are assimilated to direct descendants for the application of the gift/inheritance tax rates:

• children adopted through simple adoption, provided, amongst other things, that the adoptive child is the child of the partner of the adopter or has, before reaching the age of 21, received from the adopter (or from the adopter and his or her partner jointly), for one/six/three uninterrupted years, the care and support normally received by children from their parents; and
• the children of the partner.

In Belgium, family law falls within the competence of the federal legislator. There is no distinction, for family law purposes, between federal law and the laws of the regions or communities. As a result, conflicts comparable to those that may arise in federal systems with overlapping state and federal family law regimes do not occur in Belgium.

In an international context, however, differences may arise where family relationships are recognised or structured differently under foreign legal systems. As a general principle, Belgium recognises personal and family statuses validly established abroad, provided that they comply with the applicable Belgian rules of private international law and do not contravene international public policy (ordre public international). This approach applies in particular to marriage, registered partnerships, filiation and adoption.

Where a family relationship has been validly created under the law designated by the Belgian conflict-of-laws rules, it will in principle be recognised in Belgium, even if the corresponding legal institution does not exist in identical form under Belgian domestic law. Recognition may nevertheless be refused where the effects of that relationship would be manifestly incompatible with Belgian international public policy.

Double taxation considerations play a significant role in estate planning. For Belgian residents, inheritance tax applies to the worldwide estate, including foreign immovable and movable property. For non-residents, Belgian inheritance tax applies only to Belgian-situated immovable property. Gift tax follows a more territorial approach. Gifts of immovable property situated in Belgium are subject to Belgian gift tax regardless of the donor’s tax residence. Gifts of movable property are subject to Belgian gift tax based on the donor’s Belgian tax residence, provided that the gift is registered in Belgium.

Belgium has only signed two double taxation agreements on inheritance tax: one with France and one with Sweden. In cases where no double tax treaty applies, Belgian inheritances tax provides a local tax credit system. However such tax credits are not foreseen for gift taxes, in which case double taxation might occur.

In case the wealth planning involves the use of a trust, a foreign foundation or low-taxed foreign companies, the impact of the so-called Cayman tax needs to be taken into consideration; it provides some compliance obligations, look-through taxation and taxation at the occasion of distributions.