Corporate tax pre-payments

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Are you going to have to make your first advance payment of corporate tax soon? Getting the right information is crucial, because paying a tax surcharge can be expensive. In this article, we talk about the deadlines, how to calculate your corporate tax pre-payments, and what happens if you pay too little up front.

Who has to make advance payments of corporate tax?

Pre-payments, or advance payments, are mandatory for almost all Belgian companies subject to corporate tax.

This is also the case for foreign companies that are subject to non-resident tax (page available in French/Dutch). Of course, these pre-payments are only based on income generated or obtained in Belgium.

Small businesses, as defined in Article 1.24 of the Companies Code (page available in French/Dutch/German), do not have to pay advance payments for the first three years after they are founded. To be considered a small business in 2024, the company can only exceed one of the following three criteria:

• An annual average of maximum 50 employees
• A maximum annual turnover of €11,250,000 (excluding VAT)
• A total balance sheet of maximum €6,000,000

Why make corporate tax pre-payments?

Pre-paying corporate tax allows you to spread the tax burden over the year. By paying a portion of corporate tax each quarter, you avoid high taxes at the end of the accounting year. 

In reality, you are almost forced to make advance payments. Because if you don't, you will incur a tax surcharge.

And how much is this surcharge? 9% of your total taxable income for the 2024 financial year. Suffice to say that this penalty could have serious financial consequences for your company.

How do corporate tax pre-payments work?

As we’ve said, the idea of paying corporate tax in advance is to avoid a surcharge at the end of the financial year.

The system works as follows: for each quarter, a ‘neutralisation rate’ compensates for the surcharge. As the year progresses, this rate decreases while the surcharge increases. For the 2025 tax year (2024 income year), the figures are as follows:

• Ideally, you should pay 75% of your estimated taxes for the year in the first quarter. If you do this, you won't have to make any pre-payments for the rest of the year.
• If you don’t make a pre-payment in the first quarter, you already need to pay 90% of your total taxes in the second quarter to avoid a surcharge.
• As of the 3rd quarter, you need to pay more than the estimated tax to avoid a surcharge. 
• You can also choose to spread the pre-payments over all four quarters, thereby avoiding the tax surcharge. We’ll give you a concrete example later on.

Is it worth paying 100% of the advance payments in the first or second quarter?

No. Unlike individuals, companies are not entitled to a tax reduction (‘bonification’ or ‘bonificatie’). In other words, there’s no advantage in paying too much tax. You obviously avoid the surcharge, but that's all.

Example of advance payment of corporate tax

Let's say you estimate the taxable profits of your young company to be €50,000. In this example, we assume that you benefit from the reduced corporate tax rate of 20%. The corporate tax then amounts to €10,000. 

Imagine you make the following advance payments:

In the example above, the advance payments are spread over the four quarters. The main pre-payments are made in the first two quarters, because this is when the neutralisation rate is highest.

To put things more simply: the 9% tax surcharge still applies, but by making pre-payments, you offset this surcharge. Let's look at the numbers together:

In this example, by making your pre-payments – and by making a higher payment in the first quarter – you have offset the €900 tax increase (9% of your taxable profit) leaving only a surcharge of €10.

Want to drop the surcharge to 0 in one go? Pay 75% of your estimated tax in the first quarter. In this example, this is an advance payment of €7,500.

How do you calculate corporate tax?

Knowing all this, how do you calculate the amount of corporate tax you’ll have to pay at the end of your financial year? This is an important question, because it’s only by having a good estimate of the tax to be paid that you’ll be able to determine the right advance payments.

Start by estimating your company's total revenue as accurately as possible and then subtract all of your costs to calculate your gross profit. Your costs include business expenses, payroll costs, and amortisations. What you're left with is your taxable profit.

You’ll owe corporate tax of 25% (or the reduced rate of 20%) on this profit. However, it’s better to add a small safety margin when making your calculations. 

Not sure about the total? Your accountant will help you make this estimate and plan your pre-payments.

💡Accountable tip: in the Accountable app, you can specify how you want to make your pre-payments. The app will then calculate the exact amount of your pre-payment for you and remind you when it's due.

What if you haven't made enough pre-payments?

If you haven’t made enough advance payments, you’ll face a tax surcharge. The amount of the surcharge depends on how much you’ve already paid in pre-payments, and on the quarter in which the pre-payments were made.

Example: Let's say you have to pay €10,000 in corporate tax and you pay €5,000 in the second quarter. This gives you a 10% benefit, or €500. The 9% tax surcharge is therefore reduced to €400 (€900 – €500).

The surcharge of €400 is then added to the remaining tax amount to be paid. So in the end, you’ll have to pay €5,400 in taxes.

How to make corporate tax pre-payments?

There are three ways to make advance payments of corporate tax:

• Online via MyMinfin (platform available in French/Dutch/German)
• By bank transfer to the account BE61 6792 0022 911 of the Federal Public Service (FPS) Finance
• Via a third party who pays for you

💡Accountable tip: have you forgotten the correct structured communication to mention on your bank transfer? You can work it out using this tool (page available in French/Dutch), based on your company number.  

Remember that there’s a deadline for each quarter and that it can take several days for your payment to arrive in the tax authorities’ account. So don't wait until the last day to make your pre-payment.

Accountable is also for companies 💜

Do you want to know at any moment how much you have to pay in corporate tax and how much you’ve actually earned net? You can count on Accountable for that.

With Accountable, you save up to 6 hours of admin work per quarter and you pay less in accounting fees.

If you have a company, you can still use Accountable, but in collaboration with a trusted accountant. Because Accountable doesn’t support the preparation of balance sheets and corporate tax returns.

Test Accountable for free for 14 days with your accountant

Author - Valesca Wilms

As content marketing lead at Accountable Belgium, Valesca writes about freelancing, self-employment, and taxes based on her own experience as a freelancer.

Who is Valesca ?