New article 444 ITC and circular letter No. 2025/C/49: remaining uncertainties

Background

Under the old version of Article 444 ITC, a 10% tax increase applied where a taxpayer omitted to file its tax return (timely), or submitted an incomplete or inaccurate return. While the tax authorities could in theory waive the increase when the taxpayer acted in good faith, doing so was at their discretion, and waivers were far from guaranteed. The regime drew sustained criticism for its disproportionate impact on good-faith taxpayers.

What changed?

The Program Law of 18 July 2025 amended Article 444 ITC. Under the new regime, no tax increase shall apply in the event of a first error committed in good faith. The new regime also introduced a rebuttable presumption of good faith for first infringements: for a first infringement, the taxpayer is now deemed to have acted in good faith, unless if the tax authorities can prove that the taxpayer did not act in good faith. This rebuttable presumption does not apply in cases of ex officio tax assessments, where the taxpayer will need to prove that he acted in good faith. On 28 July 2025, the Belgian tax authorities published Circular Letter No. 2025/C/49 to comment on this new framework.

Remaining questions

Despite this welcome reform, important uncertainties remain. For example, there is still no clear definition of  "good faith". The Circular Letter offers limited guidance on how the concept should be interpreted in practice, leaving room for discussion between taxpayers and the tax authorities. Questions also arise around the treatment of ex officio assessments and the impact of a first good faith infraction (for which no tax increase is applied) on tax increases applied for future infractions. Overall, the new rules raise several practical questions that will likely be further clarified through administrative practice and case law over time.