VAT & the small-business exemption.

Details

• Source (VLAIO): https://www.vlaio.be/nl/begeleiding-advies/start/opstart-van-je-onderneming/btw-belasting-op-de-toegevoegde-waarde
• Extra source (Dexxter): https://dexxter.be/btw-plichtig-of-btw-vrijgesteld-3-cijfervoorbeelden/

What is VAT?

VAT is a consumption tax ultimately borne by the end customer. VAT-liable businesses charge VAT and (usually) can deduct input VAT on professional costs.

Are you VAT-liable?

In most cases, you are VAT-liable if you regularly supply goods or services independently. Some activities are exempt (e.g. certain socio-cultural, financial and medical activities).

VAT regimes (high level)

There are different regimes; the most common is the normal regime, and some sectors use forfaitary schemes.

Normal VAT regime: key obligations (VLAIO)

Typical obligations include invoicing, periodic VAT returns (monthly or quarterly), VAT records (incoming/outgoing invoices + daily receipts book where applicable), annual customer listing, and reporting changes.

Small-business exemption (< €25,000)

When can you opt in?

If annual turnover is < €25,000 (excl. VAT), unless excluded (e.g. certain real-estate works and some horeca/catering cases).

Consequences

• You do not charge VAT.
• You usually do not file periodic VAT returns.
• You cannot deduct input VAT on purchases/investments.
• You must add a mandatory exemption wording on invoices.

Practical rule-of-thumb (Dexxter)

• Many B2C + low costs: exemption can be interesting.
• Mostly B2B: exemption often adds little benefit.
• High costs/investments: normal regime can be better because you recover VAT.

Practical tip

Monitor turnover and plan in advance if you approach the threshold, as switching affects pricing and cashflow.