Partial abolishment of the advance payments for quarterly VAT taxable persons in Belgium

On 23 February 2017, a royal decree abolishing as from 1 April 2017 the obligation for VAT taxable persons submitting quarterly VAT returns to make advance payments, has been published in the Belgian Official Gazette.

As a consequence of this important decision, starting from 1 April 2017, VAT registered persons submitting quarterly VAT returns no longer have to make advance payments by the 20th of the second and third month following the previous quarter.

New obligation – the “December advance payment”

Does this mean that these taxable persons are totally exempted from advance payments? No! As it is the case for VAT taxable persons submitting monthly VAT returns, there is a new obligation for them to comply with a “December advance payment” by 24 December 2017. Practically, this December advance payment can be determined as follows:

  • either the VAT amount due is calculated over the outgoing and incoming transactions over the period 1 October 2017 up till (and including) 20 December 2017. This amount should then be paid by 24 December 2017 and will have to be reported in box 91 of the Q4 2017 VAT return (to be submitted by 20 January 2018)
  • or, the VAT payable amount resulting from the Q3 2017 VAT return is paid once again by 24 December 2017.

It goes without any saying that the December advance payment will be set-off against the result of the Q4 2017 VAT return and that if this Q4 return results in a VAT recoverable amount, the VAT credit will be reclaimable through the Q4 2017 VAT return.

Late payment interests

Additionally, one must note that the Belgian VAT authorities monitor the obligation to make these advance payments very strictly. Late payment interest of 0.8% per month can immediately be imposed, even if the payment is only one day late.

So even if you are not more liable for advance payments on quarterly basis, do not forget that you are now liable for a December advance Payment. Put a reminder in your agenda some days before the payment deadline in order to avoid late payment interests!

Sources: Royal Decree 16 February 2017 altering Royal Decree nrs. 1 and 24 on VAT and the obligation of making advance payments for quarterly VAT declarers, Belgian Official Gazette dd. 23 February 2017; VAT Law in Belgium

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