What is Tax Shelter?

This financial product, introduced by the federal government in 2004, aims to encourage companies to invest in audiovisual production in Belgium, in exchange for an attractive financial benefit.

Since 1 February 2017, the law has been extended to the performing arts. In early 2023, the law was further extended to gaming.

Tax Shelter is open to all Belgian companies or Belgian branches of a foreign company subject to corporate tax in Belgium.*

THE POTENTIAL GAIN OFFERED BY THE TAX SHELTER IS MADE UP OF 2 ELEMENTS:
 
A FISCAL ADVANTAGE

The company enjoys a tax exemption of 421% of the invested amount, subject to the actual receipt of the tax certificate.**. This means a tax saving of 105.25% of the amount invested (based on a corporate tax rate of 25%), i.e. the full amount of the investment and a profit of 5.25%.

 

 
A FINANCIAL RETURN

The company enjoys an additional financial bonus that is paid out up to 18 months after the investment.***

Tax Shelter diagram

As an example, let’s take an investment of €100,000, over an 18-month period, with a payment due in the first half of 2024:

  WITHOUT TAX SHELTER WITH TAX SHELTER  
Taxable base €1,200,000.00 €1,200,000.00  
Amount invested   €100,000.00 x 421%
Fiscal advantage (421%)   €421,000.00
New taxable base €1,200,000.00 €779,000.00  
Tax to be paid (25%) €300,000.00 €194,750.00  
Tax savings   €105,250.00  
Fiscal return (5.25%)   €5,250.00 5.25%*
Financial return over 18 months1   € 12,721.50  
Tax on financial return (25%)   € 3,180.38  
Net financial return   € 9,541.12 9.54%*
POTENTIAL TAX SHELTER GAIN   € 14,791.12 14,79%*
 
INVESTMENT
€100,000
 
FISCAL RETURN
105,25%
(100 × 421% exemption × 25% corporate tax)
5.25% net*
FINANCIAL RETURN
12.72% gross
 
9.54% net*
 
POTENTIAL TAX SHELTER GAIN
5.25% + 9.54%
 
14.79% net*

*This type of investment does not apply to legal entities benefiting from a reduced rate of tax, with a taxable base of less than €100,000. 
**This exemption is, however, limited to 50% of your company’s reserved taxable profits, with a maximum amount of €1,000,000 per tax period. This temporary exemption is limited to 203% of the estimated tax value of the Tax Shelter certificate. The final exemption is linked to the value of the Tax Shelter certificate actually issued by the FPS Finance. Please note that the ceilings (or maximum amounts) of a Tax Shelter investment in audiovisual works and the performing arts are not cumulative.
***Return on premium = average 12-month Euribor rate for the 6 months prior to payment, plus 450 basis points.