The impact of the Chefquet ruling on non-resident income tax (individuals)
On 12 March 2026, the Court of Justice of the European Union ruled in the Chefquet case that Belgium's additional tax on non-residents is contrary to EU law. Initial policy responses have since pointed to possible solutions for the future.
Why was the Belgian tax regime rejected?
Non-residents who earn taxable income in Belgium are subject to non-resident income tax. A federal surcharge of 7%, known as the federal additional tax, is currently applied to the tax due, calculated at progressive rates. Belgian residents, on the other hand, pay a municipal tax (ranging from 0% to 9%), with the effective rate depending on their place of main residence.
According to the Court of Justice of the European Union, this system results in a higher tax burden for non-residents than for comparable Belgian residents in certain cases. This difference constitutes a restriction on the free movement of workers. The Court emphasises that non-residents do not need to be systematically taxed more heavily. It is sufficient for the system to potentially result in less favourable treatment in certain situations.
The ruling could have significant financial implications for taxpayers. Non-residents who have paid the federal additional tax may, depending on their circumstances, consider filing an objection or requesting ex officio tax relief.
2. Towards a reform of non-resident income tax (individuals)?
In this context, the Council of Ministers approved a preliminary draft law that would allow non-residents to demonstrate that they should be allocated to a Belgian municipality with a municipal tax rate below 7%. This would ensure that they are taxed in the same way as Belgian residents in comparable circumstances.
The question is how these workers would be allocated to a municipality:
- Based on the location of their Belgian employer?
- What if there is no Belgian employer, but a tax liability arises because the 183-day rule has been exceeded?
- What if there are several Belgian employers?
- Based on where the non-resident actually works?
- What if the taxpayer works at several locations in Belgium?
- What about sales representatives or other taxpayers who regularly travel for work?
No further details are available at this stage.
3. Additional changes to non-resident income tax (individuals)
In addition to the possibility of opting for a lower municipal tax rate (instead of the flat-rate 7% federal additional tax), the preliminary draft law also provides for the following changes:
Taxation of real estate owned by non-residents
Three situations can be distinguished:
a) If a non-resident owns real estate in Belgium and also receives other Belgian-source income (remuneration, rental income or other income), they must always file a Belgian tax return.
b) If a non-resident owns real estate in Belgium, they are nevertheless exempt from the obligation to file a tax return (and therefore from Belgian taxation), provided that both of the following conditions are met:
- They receive no other Belgian-source income apart from income from real estate.
- None of the properties they own in Belgium are rented out.
In this respect, we would like to point out that the tax authorities also consider a tax return to be mandatory when Belgian-source income (other than income from real estate) is exempt from taxation in Belgium under an applicable double taxation treaty.
c) If a non-resident owns one or more properties in Belgium, at least one of which is rented out, they are generally required to file a tax return. However, if their taxable movable income is below €2,500 per person, they do not have to file a non-resident income tax return and therefore avoid Belgian taxation on their real estate.
The preliminary draft law aims to abolish this €2,500 exemption threshold. As a result, rented properties would always be subject to tax, regardless of the amount of income. It remains unclear whether the final legislative amendment will also cover the second situation and introduce taxation on properties that are not rented out.
Introduction of optional regularisation of certain income
This concerns the reporting of income for which no specific sections are currently available in the non-resident income tax return. No further details are available at this stage.
How can we help you?
Our Global Mobility specialists within Tax & Legal are closely monitoring the reforms to non-resident income tax. If you have any questions, please do not hesitate to contact your trusted adviser.