No changes for social security to Belgian expatriate tax regime

The law of December 18, 2025, containing various measures, made significant changes to the tax regime for inbound taxpayers, retroactive to January 1, 2025. We refer to our previous alert for detailed information.

The Royal Decree implementing the social security exemption tied to the tax regime in 2022 explicitly referred to the implementation of the allowances as it was in place in the tax legislation on 1 January 2022.

The Belgian social security authorities have now published an interpretative instruction clarifying that absent any change in the Royal Decree, the changes implemented as of 1 January 2025 on the tax side will not be matched for social security.
 

Tax and social security side by side

The social security exemption for the allowances will differ from the tax exemption in two ways as of 1 January 2025 (due to the retroactive implementation of the changes on tax side):

If for example an employee receives a salary of 100.000 EUR gross in 2026, and receives 35% allowances on top of this amount in application of the expat regime:

• The first 30% allowances are exempt from tax and social security
• The remaining 5% are exempt from tax, but are subject to social security contributions. As such, the employer cost for this 5% is higher (due to employer social security contributions), and the net benefit for the employee is lower (due to the employee social security contributions).

Likewise, allowances in excess of 90.000 EUR are fully tax exempt, but will be subject to employer and employee social security contributions. For example, granting a 35% cost allowance (105.000 EUR) on top of a 300.000 EUR gross salary will result in the following tax and social security treatment:

• The first 90.000 EUR is exempt from social security contributions and taxes;
• The remaining 15.000 EUR is not exempt from social security contributions, but remains tax exempt.

Of course only employees who have been granted entry to the regime based on the eligibility requirements in the tax legislation enjoy the beneficial treatment of the allowances.
 

Key takeaways

Given these differences, companies should determine their approach, weighing the pros and cons of the application of the more beneficial exemptions from a tax side against the more complex payroll processing and possible higher employer cost due to the unchanged legislation on the social security side. The question arises whether this will be the final position taken by the social security authorities or whether a revision and alignment with the tax position will be considered in the (near) future.

Furthermore, we strongly recommend a review of existing contractual arrangements in light of these changes and recent audit waves.

Contact your trusted EY advisor to discuss and do not hesitate to reach out!