The Belgian ‘Cayman tax’ and its impact on wealth and estate planning in Belgium
Saskia Lust, co-head of our Family Owned Business and Private Client practice, wrote an article on the Belgian ‘Cayman tax’ and its impact on wealth and estate planning in Belgium.
This article, published in the Trusts and Trustees journal of 28 December 2017 (Oxford University Press), is the written reproduction of the presentation Saskia Lust gave at the Benelux STEP Conference in Luxembourg on 26 September 2017.
The Belgian federal government has reinforced the Cayman tax, as part of a “tax-shift”-plan. The Cayman tax is a set of rules in the Belgian income tax code on transparency and taxation of distributions of foreign legal structures: trusts, as well as low-taxed foreign companies and foundations.
Under the proposed measures, insurance contracts can qualify as targeted structures. All distributions made by trusts to Belgian tax residents, are treated as dividends.
The bill has been voted in December 2017 and has entered into force as from 2018. However, certain aspects have entered into force retroactively, as from 17 September 2017.