On 26 February 2021, a new annual tax on securities accounts ("TSA") entered into force. With the introduction of the TSA, the legislator is making a second attempt to tax securities accounts after the annulment of the earlier legal basis. The TSA has been introduced as a subscription tax in the Code of Miscellaneous Duties and Taxes ("CMDT") and is due for holding a securities account with an intermediary defined by law (i.e. a financial institution authorised to hold financial instruments on behalf of customers, e.g. a bank).
The TSA will target securities accounts held by Belgian residents (individuals, companies or other legal entities subject to Belgian income tax), regardless of whether the securities account is held with a Belgian or a foreign intermediary. The same applies to a Belgian establishment of a non-resident. Conversely, securities accounts held by non-residents (individuals, companies or other legal entities subject to non-resident tax) with a Belgian intermediary are also taxable. Certain securities accounts used as technical working instruments in the financial system are excluded from the TSA, because the legislator wanted to preserve the normal functioning of the financial system.
The tax applies to a securities account as such and does not consider the number of holders or the title of ownership. As soon as the average value of the taxable financial instruments in a securities account exceeds EUR 1,000,000 during a reference period starting on 1 October and ending on 30 September of the following year, the TSA of 0.15% is due on the entire value of the securities account. However, the amount of the tax due is limited to 10% of the difference between the average value of the taxable financial instruments and the threshold of EUR 1,000,000.
All financial instruments (e.g. shares, bonds, and also derivatives such as turbos, trackers and speeders) and cash held in a securities account are taken into account to determine the average value. As a consequence, registered shares not held in a securities account and cash held in a current account or savings account do not fall within the scope of the TSA. The average value is determined by dividing the sum of the value of the financial instruments at the four reference dates (i.e. 31 December, 31 March, 30 June and 30 September) by the number of reference dates.
In principle, it is the Belgian intermediary (generally the bank) that is obliged to withhold, declare and pay the TSA. In all other cases (e.g. if a securities account is held with a foreign intermediary), the account holder will be responsible for the declaration and payment of the TSA. However, a foreign intermediary can appoint a representative established in Belgium to fulfil these obligations, who will then be liable towards the Belgian tax authorities. Non-compliance with the obligations will be sanctioned by penalties ranging from 10% to 200% of the tax, and late payment interest will also be payable. There are still a number of legal uncertainties as to exactly who will be liable if the tax has not been withheld (in good faith) by the intermediary.
Finally, a securities account holder cannot simply escape the tax. For example, as of 30 October 2020, the splitting of a securities account into multiple securities accounts held with the same intermediary, or the conversion of financial instruments held in a securities account into registered financial instruments are not effective against the tax authorities. From a constitutional point of view, these non-rebuttable presumptions are questionable, since they also apply to situations that are not tax driven (e.g. former registered shares that are held in dematerialised form as collateral which are converted back into registered shares after the pledge has been released, or acquisitions in the context of a public takeover bid). In addition, other transactions carried out from 30 October 2020 onwards with the aim of avoiding the TSA can also be countered by the new general anti-abuse provision introduced in the CMDT. In this case, however, there is still a possibility of demonstrating that the transaction was carried out for reasons other than avoiding the TSA (business purpose test).