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The added value coefficient for the calculation of rental benefits of company directors for 2023 has been published.
When a company director lets a building (of which he is the owner, proprietor, leaseholder, building lease holder or beneficial life interest holder) to the company or association in which he conducts his activity, the positive difference between the rent and 5/3 of the revalorized cadastral income are considered as a professional income.
The added value coefficient for the cadastral income is set at 5.37 for the income year 2023 (subject to confirmation by the Tax administration) (4.86 for the income year 2022).
Withholding tax shall be applied on the part considered as professional income. When the rent is paid monthly, the part of the rental income that is reclassified as a professional income must be treated as a periodic remuneration; it can be added to the remuneration of the month concerned and it is liable to withholding tax, just as the periodic remuneration. The reclassified amount must also be stated on the tax slip of the company director (slip 281.20).
Example: An administrator lets a building with a cadastral income of € 2,000 to his company. For the 2023 income, the annual limit is € 17,900 (= 2,000 x 5.37 x 5/3). The company pays a monthly rent of € 1,600, i.e. € 19,200 per year to the administrator; consequently, there is a positive balance of € 1,300. This amount of € 1,300 is reclassified as a professional income and is liable to withholding tax.
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