Tax-free donations before a Dutch notary can be made until the end of November

Legal Eubdate
10 September 2020

As of 1 December, a donation of movable property before a Dutch notary will be subject to gift tax in Belgium. So, if you want to make a tax-free donation before a Dutch notary, you need to act quickly.

The abolition of the "cheese route" ("kaasroute") is the result of a legislative proposal recently approved by the Parliamentary Commission for Finance, which provides for mandatory registration of foreign notarial donation deeds. In practice, this means that a donation of movable property remains possible before a Dutch (or other foreign) notary, but the notarial deed will have to be registered in Belgium and will thus always trigger Belgian gift tax. The "cheese route" will therefore no longer entail a tax advantage.

However, this does not mean that any donation of movable property will henceforth be taxable. A manual or bank donation without registration remains exempt from gift and inheritance tax, provided that the donor does not die within a period of three years after the donation (soon probably four years in the Flemish Region).

This legislative proposal also does not affect the gift tax exemption for shares in family businesses. A donation of shares in a family business can still be made tax-free before a Belgian notary.

If, however, your company does not qualify as a family business, you may benefit from having your estate planning (re)examined at short notice. As of 1 December, it will no longer be possible to donate shares of a non-family business tax-free before a Dutch notary.