Doing Business in Belgium - RSM International

Asset
Definitions
Measurement Basis
Asset
Definitions
Measurement Basis
Tangible assets
Property, Plant and Equipment
Assets are initially valued at cost, meaning either
purchase price, production cost or contribution value.
Purchase price includes ancillary costs, such as nonrecoverable
taxes and freight expenses.
Acquisition cost of tangible may include interest on
capital borrowed to finance their acquisition.
Tangible fixed assets are considered as non-monetary
items. An acquisition price denominated in foreign
currency should therefore in principle be recorded at the
exchange rate in effect at the acquisition date (or period)
and not be subsequently revalued for fluctuations of the
relevant foreign exchange rate.
In some circumstances, enterprise may revalue tangible
fixed assets. Surpluses arising on revaluation are
recorded directly on a specific section under equity, and
maintained there as long as the assets to which they
relate have not bee disposed of.
Inventory
Inventories are current assets maintained in the cycle of
operations to be:
(i) consumed when they are first used or
(ii) sold as such or after a production process.
Raw materials and consumables, finished goods, goods
purchased for resale and immovable properties acquired
or constructed for resale shall be valued at the lower of
acquisition cost and market value as at the balance sheet
date.
Work in progress shall be valued at production cost.
Work in progress shall be written down if the production
cost, plus estimated expenses still to be incurred exceeds
the net selling price at the balance sheet date.
7. Investing in Belgium
7.1. General information about investing in Belgium
7.1.1. Top EU regions: Brussels, Flanders, Wallonia: leading
investment destination
Belgium has a clearly international outlook due to its geographical location,
multicultural population and history. For centuries, it has been a crossroads and
trading hub, retaining the best of Latin, Germanic and Anglo-Saxon cultures. The
people of Belgium enjoy a fine reputation for their high level of productivity, loyalty,
openness and multilingual skills.
Belgium is a federal state consisting of three regions: Brussels, Flanders and Wallonia.
Each region has a great deal of autonomy, making Belgium one of the most modern
states in the world. The regions’ powers and responsibilities include trade, the
economy, employment, industry, agriculture and the environment. They each pursue
a dynamic economic policy.
These policies are bearing fruit. Foreign Direct Investment magazine (a Financial
Times publication) recently ranked Flanders and Wallonia among the top 5 most
attractive regions in Europe. Among large cities, Brussels ranked in the top 10
for infrastructure, quality of life and human resources. This combined regional
performance makes Belgium one of the most attractive countries in Europe, offering
an environment rich in opportunities, stable economic growth and a strong currency
(Belgium was one of the first European countries to commit to the euro).
7.1.2. An Intelligent Tax system
While all commercial companies resident in Belgium are subject to corporate income
tax, we can help you find the best fiscal mechanisms allowing you to get your project
off the ground. There is an intelligent tax solution for your project.
The authorities are well aware of how important it is to enhance upfront legal
certainty for potential and existing investors. Accordingly, Belgian tax legislation
provides economic players with a generally applicable advance ‘ruling’ practice. This
procedure is smooth, rapid and efficient. The ruling is issued within three months
and the ruling decision is legally binding for up to five years. The ruling includes the
various fiscal measures that can be used to lower the tax base or cost. The nominal
tax rate is 33.99%.
For small and medium-sized enterprises (SMEs) with a taxable profit not exceeding
322,500 euro, the tax rate drops to 24.98% at the lower end of the tax scale. Legal
mechanisms make it possible to lower the nominal rate.
48
DOING BUSINESS IN BELGIUM
DOING BUSINESS IN BELGIUM
49