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Recent parliamentary discussions have brought additional clarity regarding the reintroduction of the Belgian IP Reward regime for the IT sector.
Following the exclusion of software as of 1 January 2023, the current legislative reform confirms that the regime will once again apply to Belgian employees/ self-employed persons creating copyright-protected software developments as from 1 January 2026 (still subject to final approval), thereby addressing previous uncertainty within the IT and broader digital sector.
Key insights
- Reintroduction of software in scope
The revised framework confirms that software, applications and digital solutions will again qualify for the IP Reward regime. This applies not only to IT companies, but also to companies in other sectors (e.g. financial services or energy) performing software development activities.
- Clarification of key legal conditions
An important clarification has been provided regarding the interpretation of the exploitation criteria. The conditions relating to communication to the public, public performance or reproduction should be interpreted as alternative rather than cumulative requirements.
This interpretation significantly broadens the practical applicability of the IP regime, as it allows software development for internal use or for a limited number of clients to qualify.
- Entry into force
The new rules are expected to enter into force retroactively as from 1 January 2026.
- Continued stricter framework
While the regime is being reopened for software, it will not fully revert to the pre‑2023 framework. In particular, the abolition of the flat‑rate cost deduction (subject to limited exceptions) will result in a higher effective tax burden compared to the historical regime.
Practical implications
The clarification of the legal interpretation removes a key obstacle that previously limited the application of the regime for IT functions. As a result, the IP Reward regime once again becomes a viable structuring option for companies performing software activities.
Next steps
Although the legislative process is still ongoing, we recommend companies to start preparing for potential implementation, including:
- reviewing contractual arrangements on IP transfer or licensing;
- identifying eligible functions and activities;
- documenting the creative and original nature of software.
Timely preparation will be essential to benefit from a potential retroactive application as from 2026.
If you would like to explore the potential impact for your company, please feel free to get in touch.