Belgium Introduces Tax On Private Use Of Business Mobiles

by Ulrika Lomas, Tax-News.com, Brussels

02 December 2009

The newly-formed Belgian government, led by Prime Minister Yves Leterme, has announced its decision to impose a tax on the private use of company mobile telephones.

In accordance with a new decree, employees will be liable to pay social security contributions on private calls made on their company mobile phone.

Belgium’s Council of Ministers has ruled that, if an employee benefits from both free professional and private use of a company mobile telephone, this benefit is to be treated as part of their salary, and as such, to be liable to taxation.

Companies will, in future, be required to demonstrate a clear distinction between private and business calls made by employees on their mobiles.

As a result of the latest decision, both the company and employee will be liable to pay social security contributions. The employee will be taxed at a rate of 13% on the sum involved, which, on a sum of EUR150 (USD226) per year, amounts to around EUR20.

In the absence of any information provided by the company, employees, using their GSM business mobile for personal use, will be subject to a tax of EUR12.50 per month.

Due to enter into force on January 1, 2010, the government’s initiative is in response to a demand for clarification on the country’s existing system.

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