One figure has changed, and it concerns almost every Belgian SME run by its founder: the minimum remuneration a director must pay themselves to keep the reduced corporate income tax rate rises from €45,000 to €50,000. Behind this seemingly minor adjustment lies a real trade-off between the company's tax and the director's personal income tax — a trade-off that is not favourable in every configuration.
To benefit from the reduced corporate income tax rate — 20% on the first €100,000 of taxable profit instead of the standard 25% — a small company must, among other conditions, pay at least one director who is a natural person an annual gross remuneration of at least €50,000 (article 215 of the Belgian Income Tax Code). This threshold, previously €45,000, is raised to €50,000 for financial years starting on or after 1 January 2026, and will now be indexed. A further change: lump-sum benefits in kind may no longer represent more than 20% of that remuneration. If the condition is not met, the entire profit is taxed at 25% — and a separate assessment may be added on top.
The reduced corporate income tax rate is one of the few structural advantages a small Belgian company has. It is not requested, it is earned: the legislator has tied it to a set of requirements, the most closely monitored of which is the remuneration the director grants themselves. The underlying idea is clear — a company should not serve as a mere reservoir of lightly taxed profit while its director draws the bare minimum. Raising the threshold to €50,000 extends that logic.
A reminder: what the reduced rate is, and who it is for
Belgian corporate income tax is, in principle, 25%. By way of exception, article 215 of the Belgian Income Tax Code opens a reduced rate of 20% on the first €100,000 of taxable profit, with anything above that remaining taxed at 25%. The maximum saving per financial year is therefore 5% of €100,000, or €5,000.
This reduced rate is available only to companies qualifying as a "small company" under article 1:24 of the Belgian Code of Companies and Associations — those that do not exceed more than one of the three following criteria over two financial years: 50 employees on average, €11.25 million in turnover excluding VAT, or €6 million in balance sheet total. Further cumulative conditions apply, notably the exclusion of companies held for more than 50% by one or more other companies, and of financial companies. But the condition that trips up the most directors in practice remains the remuneration.
The new threshold: €50,000, indexed
Until now, at least one director who is a natural person had to be paid an annual gross remuneration of at least €45,000 — or, if the company's taxable result was lower, a remuneration at least equal to that result. The federal budget agreement of autumn 2025 raised that threshold to €50,000, applicable to financial years starting on or after 1 January 2026 (assessment year 2027). Another, quieter but structural change: the amount will now be indexed annually, meaning it will mechanically keep rising in the years that follow.
The remuneration taken into account comprises the director's gross salary and the benefits in kind granted to them. And this is where the second change comes in.
The 20% cap on benefits in kind
From the same reform, lump-sum benefits in kind may not represent more than 20% of the annual gross remuneration of the director. On a €50,000 threshold, this caps lump-sum benefits at €10,000: the remainder, at least €40,000, must be paid in a form other than lump-sum benefits.
This deserves the attention of directors who, until now, reached the threshold largely through benefits — company car, provision of housing, heating, electricity. A remuneration once "optimised" through benefits may today no longer satisfy the condition, even if its overall amount exceeds €50,000. The composition of the remuneration becomes as important as its total.
Failing to reach the minimum remuneration does not merely forfeit the reduced rate — in which case the entire profit is taxed at 25%. Article 219quinquies of the Belgian Income Tax Code additionally provides, in principle, for a separate assessment in the order of 5%, calculated on the difference between the required minimum remuneration and the highest remuneration actually granted to a director. The exact scope and rate of this assessment have shifted through several legislative changes: it is best to have its application confirmed by your accountant or tax adviser in light of your specific financial year.
The two exceptions to know
The €50,000 rule is not absolute. Two qualifications frame its application.
Start-up companies. The minimum remuneration condition does not apply during the first four taxable periods from the company's incorporation. A young company can therefore benefit from the reduced rate without paying €50,000 to its director during that start-up phase — a welcome breathing space when cash flow is still fragile.
Companies with a low result. Where the company's taxable result is below the threshold, the minimum remuneration is deemed met as soon as it is at least equal to that result. In other words, a company generating €30,000 of taxable result need not pay €50,000: a remuneration of €30,000 is enough to keep the reduced rate. This rule avoids forcing a company into a loss position just to satisfy the condition.
The real trade-off: should you move to €50,000?
This is the question too many directors settle by reflex. "I need the reduced rate, so I raise my salary." That is not always the right calculation, and this is precisely where an accountant's eye is useful.
Take a director who currently pays themselves €45,000 and whose company generates taxable profit above €100,000. To secure the reduced rate, they need to add €5,000 gross to their remuneration. The gain on the company side is real: the reduced rate saves up to €5,000 of corporate tax per year (5% of €100,000), and the €5,000 of additional remuneration is itself deductible. In this configuration, the move is generally favourable.
Now reverse the assumption. A company with only €40,000 of taxable profit derives from the reduced rate a maximum saving of only €2,000 (5% of €40,000). Raising the director's remuneration from €40,000 to €50,000 to capture that €2,000 saving amounts to moving €10,000 from the company to the private estate, where it will be hit by personal income tax at the marginal rate — often 50% plus municipal surcharges — and by the self-employed social security contributions. The remedy can cost more than the ailment. And recall that, in this precise example, the "low result" exception already allows the reduced rate to be kept with a remuneration of €40,000.
| Taxable profit | Max. saving from reduced rate | Is paying €50,000 justified? |
|---|---|---|
| ≥ €100,000 | €5,000 / year | Usually yes, if the director is near the threshold |
| ≈ €60,000 | €3,000 / year | To be modelled: depends on the remuneration gap to bridge |
| ≤ €50,000 | ≤ €2,500 / year | Often no — the "low result" exception suffices |
The right answer depends on three parameters: the level of taxable profit, the gap between the current remuneration and the threshold, and the director's marginal personal income tax rate. None of these parameters is constant from one company to the next.
The reduced rate is not an end in itself: it is a tool whose cost of access — the additional remuneration and the personal income tax it triggers — must be weighed against the saving it provides. For a profitable company whose director is already close to €50,000, the adjustment is almost always justified. For a company with a modest result, the question deserves to be asked calmly, figures in hand, before any general meeting resolution.
Aligning remuneration and cash extraction
Remuneration is only one of the levers for moving value between the company and its director. It coexists with the dividend, the liquidation reserve, the VVPRbis regime and more structural approaches such as the movable lease of a work of art. Each has its own cost logic and horizon: remuneration is immediately taxed in personal income tax but deductible in corporate tax; the dividend suffers a withholding tax after having already borne corporate tax; the liquidation reserve spreads the advantage over time.
Deciding on the "right" remuneration level therefore means arbitrating simultaneously between the reduced corporate tax rate, the marginal personal income tax cost and the overall cash-extraction strategy. The €50,000 threshold sets a checkpoint; it does not, by itself, dictate the optimal architecture.
The amount to pay yourself is never a universal constant: it is the result of a calculation specific to each company, its profit, its horizon and the personal situation of its director. That is the work of a conversation — not of an article.