Belgium: Notional interest deduction

Notional interest deduction. As of assessment year 2013, the notional interest deduction (NID) rate may no longer exceed 3% (3.5% for SMEs). Since the average return on the 10-year government bond (OLO) for the year 2011 was higher than 3%, it is this maximum rate that applies in the ssessment year 2013.

Moreover, the possibility of carrying forward to the 7 following taxable periods any excess NID that could not be deducted because of insufficient taxable profits has been eliminated. However, according to a transitional measure the stock of carried forward NID at 31 December 2011 or at the end of the taxable period linked to the assessment year can still be carried forward and deducted from the profits of the 7 following taxable periods. The amount of the deduction for each taxable period is, however, limited. For taxable income exceeding 1 million euro, the amount of deduction above this level is limited to 60%.

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