Chapter 4 Inheritance Tax
Worldwide estate of a deceased person is taxed through the inheritance tax. Unregistered8 gifts (and registered immovable property gifts in Wallonia) made in the three years prior to his/her death by the deceased are also subject to the tax. The tax rates differ by region and by relationship between the deceased and his/her heirs. Several exemptions (= reductions in tax base) exist, among others when inheriting a family business or residence.
4.1 Brussels
4 different categories of relations between deceased and heirs are considered: 1) partner or direct relative (child, grandchild, parent and grandparent), 2) sibling, 3) distant relative (aunt, uncle, nephew, niece) and 4) other. In the third and fourth category, rates are applied on global amount and not on the amount of each heir.
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 50000 | 0.03 |
| 50000.01 | 100000 | 0.08 |
| 100000.01 | 175000 | 0.09 |
| 175000.01 | 250000 | 0.18 |
| 250000.01 | 500000 | 0.24 |
| 500000.01 |
|
0.30 |
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 50000 | 0.02 |
| 50000.01 | 100000 | 0.053 |
| 100000.01 | 175000 | 0.06 |
| 175000.01 | 250000 | 0.12 |
| 250000.01 | 500000 | 0.24 |
| 500000.01 |
|
0.30 |
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 12500 | 0.20 |
| 12500.01 | 25000 | 0.25 |
| 25000.01 | 50000 | 0.30 |
| 50000.01 | 100000 | 0.40 |
| 100000.01 | 175000 | 0.55 |
| 175000.01 | 250000 | 0.60 |
| 250000.01 |
|
0.65 |
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 50000 | 0.35 |
| 50000.01 | 100000 | 0.50 |
| 100000.01 | 175000 | 0.60 |
| 175000.01 |
|
0.70 |
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 50000 | 0.40 |
| 50000.01 | 100000 | 0.55 |
| 100000.01 | 175000 | 0.65 |
| 175000.01 |
|
0.80 |
The exemptions are the following:
- Legal partners benefit from a €15.000 “foot-exemption” (i.e. on the lowest bracket). In addition, the partner benefits from half of the exemptions common children receive.
- Direct line heirs (children, grandchildren, parents, grandparents) also benefit from a €15.000 “foot-exemption”. Children under 21 benefit from an extra €2.500 exemption per full year before the age of 21. The family house is also taxed at a lower rate (see Table 4.2).
- Brothers and sisters, uncles, aunts, nephews and neices and other relatives do not have to pay taxes if the inheritance is lower than €1.250.
- Heirs having at least 3 living children younger than 21 benefit from a 2% reduction on inheritance tax for each of those children, with a maximum of €62 per child.
- At certain conditions (related to the activities, ownership and location of the firm), heirs pay only 3% (or 7% when not partner, child, grandchild, parent or grandparent) taxes on the inheritance of a family business.
4.2 Flanders
3 different categories of relations between deceased and heirs are considered: 1) partner (including de facto partners that lived at least 1 year together before decease) or direct relative (child, grandchild, parent and grandparent) 2) siblings, 3) distant relative (aunt, uncle, nephew, niece) or other. In the first category, immovable and movable parts are taxed separately. In the third category, rates are applied on global amount and not on the amount of each heir.
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 50000 | 0.03 |
| 50000.01 | 250000 | 0.09 |
| 250000.01 |
|
0.27 |
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 35000 | 0.25 |
| 35000.01 | 75000 | 0.30 |
| 75000.01 |
|
0.55 |
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 35000 | 0.25 |
| 35000.01 | 75000 | 0.45 |
| 75000.01 |
|
0.55 |
The exemptions are the following:
- Legal partners (and de facto partners if they lived 3 year together) do not pay taxes on inheritance of the family residence. They moreover benefit from a €50.000 exemption on movable property.
- Heirs yougner than 21 benefit from a €75 reduction per full year before the age of 21. When they have lost their both parents, do not pay taxes on the inheritance of the family residence and benefit from an exemption of €75.000 on movable property.
- At certain conditions (related to the activities, ownership and location of the firm), heir pay only 3% (or 7% when not partner, child, grandchild, parent or grandparent) taxes on the inheritance of a family business.
4.3 Wallonia
4 different categories of relations between deceased and heirs are considered: 1) partner, child, grandchild and parent. 2) siblings, 3) aunt, uncle, nephew, niece and 4) other.
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 12500 | 0.03 |
| 12500.01 | 25000 | 0.04 |
| 25000.01 | 50000 | 0.05 |
| 50000.01 | 100000 | 0.07 |
| 100000.01 | 150000 | 0.10 |
| 150000.01 | 200000 | 0.14 |
| 200000.01 | 250000 | 0.18 |
| 250000.01 | 500000 | 0.24 |
| 500000.01 |
|
0.30 |
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 25000 | 0.01 |
| 25000.01 | 50000 | 0.02 |
| 50000.01 | 175000 | 0.05 |
| 175000.01 | 250000 | 0.12 |
| 250000.01 | 500000 | 0.24 |
| 500000.01 |
|
0.30 |
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 12500 | 0.20 |
| 12500.01 | 25000 | 0.25 |
| 25000.01 | 75000 | 0.35 |
| 75000.01 | 175000 | 0.50 |
| 175000.01 |
|
0.65 |
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 12500 | 0.25 |
| 12500.01 | 25000 | 0.30 |
| 25000.01 | 75000 | 0.40 |
| 75000.01 | 175000 | 0.55 |
| 175000.01 |
|
0.70 |
| From (€) | To (€) | Rate |
|---|---|---|
| 0.01 | 12500 | 0.25 |
| 12500.01 | 25000 | 0.30 |
| 25000.01 | 75000 | 0.40 |
| 75000.01 | 175000 | 0.55 |
| 175000.01 |
|
0.70 |
The exemptions are the following:
- Legal partners benefit from a €12.500 “foot-exemption”. This exemption is doubled if the total inheritance does not exceed €125.000. The family house is totally exempted for partners. In addition, they benefit from half of the exemptions common children receive.
- Direct line heirs (children, grandchildren, parents) also benefit from a €12.500 “foot-exemption”. This exemption is doubled if the total inheritance does not exceed €125.000. Children under 21 benefit from an extra €2.500 exemption per full year before the age of 21. The family house is also taxed at a lower rate (see table 4.10).
- Heirs having at least 3 living children younger than 21 benefit from a 2% reduction on inheritance tax for each of those children, with a maximum of €62 per child.
- Heirs pay no taxes on the inheritance of a family business, when some conditions are met (related to the activities, ownership and location of the firm).
4.4 Modelling assumptions
- Inheritances from one partner to the other are not modeled.
- Assumptions are made to impute the shares of the total value of the inheritance that belong to the different categories: immovable property excluding family house, family house, movable property, business. (To be specified)
4.5 Module input
4.5.1 Variables
#> Warning in create_inputvar_table(path_xlsx): Some variables are missing:
#> drg_h_sc, inh_dwe01, inh_imm01, inh_mov01, inh_bus01, inh_dwe02, inh_imm02,
#> inh_mov02, inh_bus02, inh_dwe03, inh_imm03, inh_mov03, inh_bus03, inh_fw01,
#> inh_fw02, inh_fw03, inh_heirs01, inh_heirs02, inh_heirs03.| Name | Description | Database |
|---|---|---|
| drg_h_sc | Region | SILC |
| inh_bus01 | value of inherited business (first inheritance) | Other |
| inh_bus02 | value of inherited business (second inheritance) | Other |
| inh_bus03 | value of inherited business (third inheritance) | Other |
| inh_dwe01 | value of inherited family dwelling (first inheritance) | Other |
| inh_dwe02 | value of inherited family dwelling (second inheritance) | Other |
| inh_dwe03 | value of inherited family dwelling (third inheritance) | Other |
| inh_fw01 | from whom received (first inheritance) | Other |
| inh_fw02 | from whom received (second inheritance) | Other |
| inh_fw03 | from whom received (third inheritance) | Other |
| inh_heirs01 | number of heirs (first inheritance) | Other |
| inh_heirs02 | number of heirs (second inheritance) | Other |
| inh_heirs03 | number of heirs (third inheritance) | Other |
| inh_imm01 | value of inherited immovable property excl. Family dwelling (first inheritance) | Other |
| inh_imm02 | value of inherited immovable property excl. Family dwelling (second inheritance) | Other |
| inh_imm03 | value of inherited immovable property excl. Family dwelling (third inheritance) | Other |
| inh_mov01 | value of inherited movable property (first inheritance) | Other |
| inh_mov02 | value of inherited movable property (second inheritance) | Other |
| inh_mov03 | value of inherited movable property (third inheritance) | Other |
4.5.2 Parameters
| Name | Description | Value (2020) |
|---|---|---|
| inh_b_brack_direct_bus | brussels / brackets / direct relative / business | Inf |
| inh_b_brack_direct_dwe | brussels / brackets / direct relative / dwelling | 50000, 100000, 175000, 250000, 500000, Inf |
| inh_b_brack_direct_gen | brussels / brackets / direct relative / general | 50000, 100000, 175000, 250000, 500000, Inf |
| inh_b_brack_distant_bus | brussels / brackets / distant relative / business | Inf |
| inh_b_brack_distant_gen | brussels / brackets / distant relative / general | 50000, 100000, 175000, Inf |
| inh_b_brack_other_bus | brussels / brackets / other / business | Inf |
| inh_b_brack_other_gen | brussels / brackets / other / general | 50000, 100000, 175000, Inf |
| inh_b_brack_sibling_bus | brussels / brackets / sibling / business | Inf |
| inh_b_brack_sibling_gen | brussels / brackets / sibling / general | 12500, 25000, 50000, 100000, 175000, 250000, Inf |
| inh_b_direct_exemp1 | 15000 | |
| inh_b_direct_exemp2_young21 | 2500 | |
| inh_b_direct_max | 0 | |
| inh_b_distant_max | 1250 | |
| inh_b_other_max | 1250 | |
| inh_b_rates_direct_bus | brussels / rates / direct relative / business | 0.03 |
| inh_b_rates_direct_dwe | brussels / rates / direct relative / dwelling | 0.02, 0.053, 0.06, 0.12, 0.24, 0.30 |
| inh_b_rates_direct_gen | brussels / rates / direct relative / general | 0.03, 0.08, 0.09, 0.18, 0.24, 0.30 |
| inh_b_rates_distant_bus | brussels / rates / distant relative / business | 0.07 |
| inh_b_rates_distant_gen | brussels / rates / distant relative / general | 0.35, 0.50, 0.60, 0.70 |
| inh_b_rates_other_bus | brussels / rates / other / business | 0.07 |
| inh_b_rates_other_gen | brussels / rates / other / general | 0.40, 0.55, 0.65, 0.80 |
| inh_b_rates_sibling_bus | brussels / rates / sibling / business | 0.07 |
| inh_b_rates_sibling_gen | brussels / rates / sibling / general | 0.20, 0.25, 0.30, 0.40, 0.55, 0.60, 0.65 |
| inh_b_red1_child21_max | brussels / reduction 1 / children below 21 / maximum amount | 62 |
| inh_b_red1_child21_rate | brussels / reduction 1 / children below 21 / rate | 0.02 |
| inh_b_red2_young21 | brussels / reduction 2 / people below 21 | 0 |
| inh_b_sibling_max | brussels / sibling / maximum exempted inheritance | 1250 |
| inh_f_brack_direct_bus | flanders / brackets / direct relative / business | Inf |
| inh_f_brack_direct_gen | flanders / brackets / direct relative / general | 50000, 250000, Inf |
| inh_f_brack_distant_bus | flanders / brackets / distant relative / business | Inf |
| inh_f_brack_distant_gen | flanders / brackets / distant relative / general | 35000, 75000, Inf |
| inh_f_brack_other_bus | flanders / brackets / other / business | Inf |
| inh_f_brack_other_gen | flanders / brackets / other / general | 35000, 75000, Inf |
| inh_f_brack_sibling_bus | flanders / brackets / sibling / business | Inf |
| inh_f_brack_sibling_gen | flanders / brackets / sibling / general | 35000, 75000, Inf |
| inh_f_direct_exemp1 | 15000 | |
| inh_f_direct_exemp2_young21 | 0 | |
| inh_f_direct_max | 0 | |
| inh_f_distant_max | 0 | |
| inh_f_other_max | 0 | |
| inh_f_rates_direct_bus | flanders / rates / direct relative / business | 0.03 |
| inh_f_rates_direct_gen | flanders / rates / direct relative / general | 0.03, 0.09, 0.27 |
| inh_f_rates_distant_bus | flanders / rates / distant relative / business | 0.07 |
| inh_f_rates_distant_gen | flanders / rates / distant relative / general | 0.25, 0.45, 0.55 |
| inh_f_rates_other_bus | flanders / rates / other / business | 0.07 |
| inh_f_rates_other_gen | flanders / rates / other / general | 0.25, 0.45, 0.55 |
| inh_f_rates_sibling_bus | flanders / rates / sibling / business | 0.07 |
| inh_f_rates_sibling_gen | flanders / rates / sibling / general | 0.25, 0.30, 0.55 |
| inh_f_red1_child21_max | flanders / reduction 1 / children below 21 / maximum amount | 62 |
| inh_f_red1_child21_rate | flanders / reduction 1 / children below 21 / rate | 0.02 |
| inh_f_red2_young21 | 75 | |
| inh_f_sibling_max | 0 | |
| inh_w_brack_direct_bus | wallonia / brackets / direct relative / business | Inf |
| inh_w_brack_direct_dwe | wallonia / brackets / direct relative / dwelling | 25000, 50000, 175000, 250000, 500000, Inf |
| inh_w_brack_direct_gen | wallonia / brackets / direct relative / general | 12500, 25000, 50000, 100000, 150000, 200000, 250000, 500000, Inf |
| inh_w_brack_distant_bus | wallonia / brackets / distant relative / business | Inf |
| inh_w_brack_distant_gen | wallonia / brackets / distant relative / general | 12500, 25000, 75000, 175000, Inf |
| inh_w_brack_other_bus | wallonia / brackets / other / business | Inf |
| inh_w_brack_other_gen | wallonia / brackets / other / general | 12500, 25000, 75000, Inf |
| inh_w_brack_sibling_bus | wallonia / brackets / sibling / business | Inf |
| inh_w_brack_sibling_gen | wallonia / brackets / sibling / general | 12500, 25000, 75000, 175000, Inf |
| inh_w_direct_exemp1 | 15000 | |
| inh_w_direct_exemp2_young21 | 2500 | |
| inh_w_direct_max | 0 | |
| inh_w_distant_max | 0 | |
| inh_w_other_max | 0 | |
| inh_w_rates_direct_bus | wallonia / rates / direct relative / business | 0 |
| inh_w_rates_direct_dwe | wallonia / rates / direct relative / dwelling | 0.01, 0.02, 0.05, 0.12, 0.24, 0.30 |
| inh_w_rates_direct_gen | wallonia / rates / direct relative / general | 0.03, 0.04, 0.05, 0.07, 0.10, 0.14, 0.18, 0.24, 0.30 |
| inh_w_rates_distant_bus | wallonia / rates / distant relative / business | 0.07 |
| inh_w_rates_distant_gen | wallonia / rates / distant relative / general | 0.25, 0.30, 0.40, 0.55, 0.70 |
| inh_w_rates_other_bus | wallonia / rates / other / business | 0.07 |
| inh_w_rates_other_gen | wallonia / rates / other / general | 0.30, 0.35, 0.60, 0.80 |
| inh_w_rates_sibling_bus | wallonia / rates / sibling / business | 0 |
| inh_w_rates_sibling_gen | wallonia / rates / sibling / general | 0.20, 0.25, 0.35, 0.50, 0.65 |
| inh_w_red1_child21_max | wallonia / reduction 1 / children below 21 / maximum amount | 62 |
| inh_w_red1_child21_rate | wallonia / reduction 1 / children below 21 / rate | 0.02 |
| inh_w_red2_young21 | 0 | |
| inh_w_sibling_max | 0 |
4.7 References
[] Fiscalite Brussels - Transmission entreprises. 2020. URL: https://fiscalite.brussels/transmission-des-petites-et-moyennes-entreprises-ou-des-entreprises-et-soci-t-s-familiales.
[] SPF Finances - Droits de succession. 2020. URL: https://finances.belgium.be/fr/particuliers/famille/deces/droits_de_succession.
[] SPF Finances - Memento Fiscal. 2020. URL: https://finances.belgium.be/sites/default/files/Statistieken_SD/FM_MF_TS_StM/MF2018_V01_complet.pdf.
[] Vlaamse Overheid - Erfbelasting. 2021. URL: https://www.vlaanderen.be/erfbelasting/tarieven-in-de-erfbelasting.
[] Wallonie - Transmission entreprises. 2021. URL: https://www.wallonie.be/fr/demarches/obtenir-un-taux-reduit-de-droit-de-donation-ou-succession-dans-le-cadre-de-la-transmission.
Gifts can be (but do not have to be) registered through a notarial deed. See Chapter: Gift Tax↩︎