Capital losses and gains

In principle, capital losses are deductible for corporate income tax purposes.

As an exception to this rule, capital losses on shares are not tax deductible unless, and to the extent that, they occur because of a liquidation and reflect a permanent loss of paid-up share capital.

In principle, capital gains are taxable upon realisation. As an exception to this rule, realised capital gains on shares are free of taxes (subject to conditions).

As of assessment year 2007, all capital gains are only considered on a “net” basis (as opposed to a “gross” basis) for Belgian tax (relief) purposes.

Unrealised capital gains (e.g. gains that are merely expressed in the accounts) can be temporarily exempted from taxes, subject to conditions.

The taxation of capital gains realised on tangible fixed assets or intangible fixed assets that have been depreciated for tax purposes and been held for more than five years prior to disposal can be deferred, provided the full proceeds are reinvested in new or second-hand depreciable tangible or intangible fixed assets that are used for a business activity in Belgium in due time. Where reinvestment occurs, taxation of the capital gains is spread over the depreciation period of the assets in which the realisation proceeds are reinvested. For reinvestments in buildings, ships or aircraft, the reinvestment period is five years. In all other cases, the reinvestment period is three years.