Property Tax Issues
Belgians charge with taxes based on worldwide income. The taxable income is based on the “cadastral income” or the deemed income of the property. This value is indexed on an annual basis, and in practice the 1975 index is used. Thus, cadastral income values are usually lower than the actual rental incomes. Depreciation, repairs and renovations, payments on interest, as well as real estate and inheritance are deducted from the cadastral value.
Property Tax
Expenses relating to real estate or immovable property are computed on a flat basis, and usually depends on whether the property is built upon or not. If the property has structures or buildings, a 40% deduction is charged; otherwise, the charge is 10%. For rented property, depreciation is computed by deducting the ratio of scrap value over estimated life from the property value. In Belgium, an annual depreciation rate of real estate is charged, at around 3% of the property’s investment value.
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