Exemption for research and development: notify Belspo of your ongoing R&D project or programme by 1 August 2023

As of 1 August 2023, the FPS Finance will adopt a stricter position on when to notify Belspo of an R&D project or programme. From then on, you must notify Belspo before the project or programme start date. Check to see if you need to take action!

Notification is an essential requirement

To qualify for the exemption from advance payment of withholding tax for research and development, the research or development projects or programmes (R&D projects or programmes) must be notified to the Federal Public Planning Service Science Policy (Belspo).

The notification must contain the following information:

• The identification of the person liable for the withholding tax;
• The description of the project or programme showing that its purpose is fundamental research, industrial research or experimental development;
• The scheduled starting date of the project or programme;
• The expected end date of the project or programme.

Position of the FPS Finance on the time of the notification

The administrative position until now determined that the exemption can only be applied from the month of notification of the project or programme to Belspo, even if the start date of the project or programme was before this notification.

Example: a research project runs over 24 months. During the 10th month, the project is notified to Belspo. The exemption can be applied from the 10th month, i.e. the month in which the project is notified. Retroactive application of the exemption from the 1st month (a month in which the project was not yet notified) is not possible.

Stricter position as of 1 August 2023

In its decision of 6 January 2023, the Court of Cassation adopts a stricter position than the FPS Finance. The Court states that notification must take place prior to the start date of the R&D projects or programmes.

The FPS Finance follows the Court of Cassation's decision and will adopt a stricter position as of 1 August 2023. In this way, the employers concerned can adapt their internal procedures to this new position.

As of 1 August 2023, notification of an R&D project or programme must take place before the start date of that project or programme. In practice, this means that the exemption will only apply to the remuneration of eligible staff in R&D projects or programmes that have not yet started if these projects or programmes have been notified to Belspo prior to their start date.

Example: a research project starts on 1 September 2023. The project is notified to Belspo on 24 August 2023. Notification of the project takes place before the project started. The exemption can be applied to the remuneration of eligible staff participating in the research project.

What does this change mean for you?

We make the following distinction:

• R&D projects or programmes already underway that were notified to Belspo before 1 August 2023: check that the notification is complete or renew the notification in July 2023, clearly stating all R&D activities taking place in July 2023 and add all new R&D activities scheduled from 1 August 2023 to it. The more complete the notification, the easier it will be to avoid discussions during an audit by the FPS Finance. Belspo's recommendation for an annual or periodic update of the notification of projects and programmes will temporarily cease to apply. Belspo recommends converting programmes already notified for 2023 into multi-year programmes, without mentioning a year in the title of the programme and indicating a sufficiently long, yet realistic duration.
• ongoing R&D projects or programmes that have not yet been notified to Belspo: notify them as soon as possible and no later than 31 July 2023, providing all legally required data. This will allow you to benefit from the exemption from withholding tax on the remuneration of eligible personnel employed in the notified R&D projects or programmes from the time of notification.
• R&D projects or programmes starting from 1 August 2023: notify these R&D projects or programmes to Belspo before their start date. The exemption is applied to the remuneration of eligible staff employed in the notified R&D projects or programmes.

We are glad to help you

Do you have any questions about the FPS Finance's stricter position? Or would you like more information on the conditions of application of the exemption from advance payment of withholding tax for research and development? Contact our Legal Consultants at GEConsulting@partena.be.

Sources: Circular 2023/C/49 on the time of notification for the exemption from advance payment of withholding tax for researchers; Belspo Notice - Notification to Belspo as of 01/08/2023.